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UNIVERSITY  Of 

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PERSONNEL  ADMINISTRATION 


ITS  PRINCIPLES  AND  PRACTICE 


PUBLISHERS 


BOOKS     F  O  R^/ 


Electrical  "\Xforld  *?  Engineering  News-Record 
Power  v  Engineering  and  Mining  Journal-Ftess 
Chemical  and  Metallurgical  Engineering 
Electric  Railway  Journal  v  Coal  Age 
American  Machinist  •=•  Ingenieria  Internacional 
Electrical  Merchandising  v  BusTransportation 
Journal  of  Electricity  and  Western  Industry 
Industrial  Engineer 


•niiiiiiuiiiiiiiiiiiuiiiiiiiiMUiiHiiiiiiiiuiiiuiiuiiuiiiiiiitiniiiiiiiiimuiiiiiuiimiiiiiuiiiiiiiiiiii^ 


ITS  PRINCIPLES  AND  PRACTICE 


BY 
ORDWAY  TEAD 

AND 

HENRY  C.  METCALF,  PH.D. 


FIRST  EDITION 
SIXTH  IMPRESSION 


McGRAW-HILL  BOOK  COMPANY,  INC. 

NEW  YORK:    370   SEVENTH   AVENUE 

LONDON:    6  &  8  BOUVERIE  ST.,  E.  C.  4 

1920 


COPYRIGHT,  1920,  BY  THE 

BOOK  COMPANY,  INC. 


PRINTED  IN   THE    UNITED  8TATEH    OF   AMERICA 


THK  MAPLK  rmmmm  •  YORK 


<3o 

THE    MEMORY    OF 

ROBERT  GROSVENOR  VALENTINE 

A  pioneer  in  personnel  administration. 

A  devotee  of  science  in  the  service  of 

democracy. 

"We  are  staggered  today  by  the  great 
new  forces  apparently  adrift  in  the 
world.  These  forces  become  manage- 
able before  the  attack  of  the_sciejitific. 
mind  humanly  purposed." 

R.  G.  V. 


• 


PREFACE 

The  purpose  of  this  book  is  to  set  forth  the  principles  and  the 
best  prevailing  practice  in  the  field  of  the  administration  of  hu- 
man relations  in  industry.  It  is  addressed  to  employers,  person- 
nel executives  and  employment  managers,  and  to  students  of 
personnel  administration  whether  they  are  in  schools  of  business 
administration  or  already  in  industry  in  some  executive  capacity. 
But  we  hope  that  it  will  have  value,  also,  for  all — managers, 
workers,  consumers — who  are  interested  to  advance  right  human 
relations  in  industry,  and  to  secure  a  productivity  which  is  due 
to  willing  human  cooperation,  interest  and  creative  power. 

The  field  of  administrative  activity  covered  by  the  book 
includes  all  those  efforts  usually  included  in  personnel  manage- 
ment; employment,  health  and  safety,  training,  personnel  re- 
search, service  features  and  joint  relations.  And  we  seek,  also, 
to  show  the  relation  of  the  personnel  problems  of  each  corporation 
to  those  of  its  industry  as  whole,  by  considering  in  conclusion 
the  activities  of  employers'  associations  and  the  dealings  which 
they  may  have  with  organizations  of  workers  on  a  district  or 
national  scale. 

We  may  be  questioned  for  our  temerity  in  affirming  "prin- 
ciples" and  "standard  practice"  thus  early  in  the  development 
of  a  relatively  new  field  of  specialized  effort.  But  these  principles 
grow  out  of  modern  knowledge  of  human  nature  and  its  constit- 
uent elements — not  out  of  transient  industrial  conditions.  Ad- 
ministrators are  dealing  with  human  beings — personalities  whose 
inherent  tendencies  and  impulses,  whose  characteristic  reactions, 
whose  hopes  and  aspirations,  are  being  revealed  by  the  study  of 
human  behavior.  And  determination  as  to  how  industrial  pro- 
cedure can  be  best  adapted  to  this  human  nature  which  is  the 
animating  power  of  industry,  is  therefore  conditioned  primarily 
by  our  knowledge  of  that  nature,  and  a  knowledge  of  the  critical 
points  of  its  suppression,  conflict  and  maladjustment  in  industry. 

On  the  whole  it  is  also  true  that  the  principles  underlying  suc- 
cessful practice  in  the  administration  of  personnel  activities, 


Vlll  PREFACE 

apply  independently  of  the  larger  economic  issues  which,  how- 
ever, cannot  be  wholly  excluded  from  a  study  of  this  kind. 
Under  any  or  all  systems  of  industrial  ownership,  the  problem 
of  human  relationship  and  adjustment  between  managers  and 
managed,  and  among  workers,  remains.  And  it  remains  as  sub- 
stantially the  same  problem.  The  great  majority  of  problems — 
selection,  advancement,  job  analysis,  pay  adjustments — grow 
necessarily  out  of  a  machine  era  with  its  subdivision  of  labor  and 
its  separation  of  executive  from  manual  worker.  For  this  reason 
we  are  hopeful  that  our  principles,  if  valid,  are  valid  for  different 
industries,  different  localities,  even  different  industrial  systems 
and  for  other  than  industrial  organizations. 

We  have  been  at  pains  to  use  as  illustrations  procedure  which 
has  proved  successful  in  one  or  more  plants  in  recent  years. 
But  we  are  under  no  illusion  that  practices  useful  in  one  situation 
are  necessarily  useful  in  another.  The  reader  should  constantly 
bear  in  mind,  for  example,  that  methods  which  apply  in  a  large 
plant  are  not  necessarily  the  best  in  a  small  plant;  that  city 
factory  conditions  are  different  from  country  factory  conditions; 
that  the  situation  where  unskilled,  foreign-born  workers  pre- 
dominate is  in  certain  respects  unlike  that  where  native  born 
workers  are  in  the  majority.  Each  organization's  problems 
must  be  analysed  separately,  and  conclusions  must  be  reached 
on  the  basis  of  sound  thinking  about  principles  and  critical  study 
of  all  suggested  methods. 

There  are  no  panaceas  or  cure-alls  in  this  field.  The  size  of 
this  book  and  the  variety  of  the  topics  treated  will  give  evidence 
of  this  convincingly,  if  any  proof  is  needed.  There  is  a  bewilder- 
ing variety  of  methods,  practices  and  activities  which  must  all 
be  simultaneously  carried  forward  if  personnel  administration 
is  to  be  effective.  This  does  not  mean,  however,  that  they  should 
all  be  started  at  once.  They  should  l>e  developed  as  the  need 
for  them  is  felt  and  as  they  justify  their  existence.  "Prove  all 
things  and  hold  fast  to  that  which  is  good." 

There  has  been  in  some  organizations  an  unfortunate  tendency 
to  overdevelop  some  one  activity  which  was  of  special  interest 
to  some  executive.  But  the  time  is  past  when  hobbies  or  pet 
ideas  should  be  allowed  to  develop  at  the  expense  of  a  rounded 
human  relations  policy.  The  surest  index  of  a  personnel  execu- 
tive's grasp  of  his  problem  is  his  ability  to  keep  a  sane  propor- 
tion in  the  unfolding  of  his  different  administrative  tasks. 


PREFACE  ix 

For  all  these  reasons  our  discussion  of  successful  practices  has 
taken  the  form  of  illustrations  of  our  conclusions  rather  than  of 
numerous  examples  which  might  be  uncritically  copied.  This 
book  aims  to  be  a  helpful  manual;  but  we  cannot  repeat  too 
emphatically  that  every  individual  application  of  a  principle 
has  to  be  made  in  its  own  way  in  the  light  of  the  local  circum- 
stances. Hence  we  urge  that  the  book  be  read  quite  as  much  to 
absorb  a  certain  helpful  point  of  view  toward  human  relations 
as  to  discover  specific  next  steps. 

To  the  extent  that  the  reader  grasps  and  applies  the  liberal, 
scientific  and  human  points  of  view  which  animate  this  volume, 
he  will  find  that  more  ways  and  means  will  suggest  themselves 
for  use  under  his  own  conditions  than  we  could  enumerate  in  a 
much  larger  volume.  "Tell  a  man  how  to  do  a  thing,  and  he 
will  not  know  how  to  do  it;  said  a  very  wise  educator,  "show  him 
how  by  doing  it  before  his  eyes,  and  he  still  will  not  know  how  to 
do  it.  The  only  way  for  him  really  to  learn  is  by  doing  it  himself. ' ' 

Five  years  from  now  a  more  scientifically  accurate  and  inform- 
ing text  could  undoubtedly  be  written  on  this  subject  than  is 
now  possible.  Presumably  more  standards  of  procedure  will 
have  become  clear.  But  the  need  for  a  volume  to  state  the 
problem,  define  its  limits  and  suggest  the  current  develop- 
ments, is  immediately  urgent.  Already  more  firms  see  the 
need  for  specialized  executive  direction  in  personnel  work  than 
can  find  executives  competent  to  assume  it.  Our  volume  is 
therefore  offered  at  this  time  with  a  full  consciousness  of  its 
limitations,  but  with  the  hope  that  it  may  help  to  establish  the 
executive  direction  of  human  relations  on  a  professional  plane 
where  a  high  ethical  obligation  of  service  shall  be  the  controlling 
motive,  and  humanly  scientific  standards  become  the  criterion 
of  wise  practice. 

Since  a  selection  of  the  topics  to  be  treated  was  necessary  in 
any  case,  we  have  chosen  those  which  seemed  to  us  vital,  and 
have  brought  them  into  an  arrangement  and  grouping  which 
have  a  certain  logic  from  the  administrator's  point  of  view; 
although  we  recognize  that  any  functional  grouping  is  arbitrary 
at  best. 

Needless  to  say,  in  a  volume  of  this  character  the  element  of 
originality  cannot  be  great;  and  we  have  tried  to  acknowledge 
throughout  the  text  the  sources  of  specific  suggestions.  But 
inevitably  since  our  indebtedness  extends  in  many  directions, 


X  PREFACE 

all  personal  acknowledgements  have  not  been  made.  And  we 
can  best  express  our  very  real  gratitude  to  our  unmentioned 
helpers  by  insisting  that  we  regard  this  book  as  theirs  as  well  as 
ours. 

We  recognize  especially,  however,  the  helpful  services  of  our 
former  colleagues  in  the  Bureau  of  Industrial  Research  at  every 
stage  of  the  volume's  preparation,  the  beneficial  criticism  of 
managers  for  whom  we  have  acted  as  consultants,  and  the  cumu- 
lative suggestions  of  successive  classes  with  whom  we  have  studied 
this  subject  from  every  angle. 

To  Robert  G.  Valentine,  to  whose  memory  we  dedicate  the 
book,  we  owe  a  peculiar  debt  of  inspiration  and  suggestion. 
Although  Mr.  Valentine  died  in  1916  before  any  of  this  material 
was  in  its  present  form,  he  exercised  a  determining  influence  in 
the  direction  taken  by  the  text  in  the  methods  proposed  no  less 
than  in  the  underlying  point  of  view. 

THE  AUTHORS. 

March  1,  1920. 


CONTENTS 

PREFACE vii-x 

I.  INTRODUCTORY 

CHAPTER  PAGE 

I.  The  Field  of  Personnel  Administration 1-11 

-  II.  Human  Values  in  Industry 12-22 

II.  THE  PERSONNEL  DEPARTMENT 

III.  The  Reasons  for  a  Personnel  Department 23-29 

IV.  Functions  of  a  Personnel  Department 30-40 

III.  EMPLOYMENT  METHODS 

V.  Sources  of  Labor  Supply 41—48 

VI.  Methods  of  Selection  and  Placement 49-66 

IV.  HEALTH  AND  SAFETY 

VII.  Hours  and  Working  Periods 67-83 

VIII.  The  Health  of  the  Worker 84-100 

IX.  A  Safety  Program 101-108 

X.  Standards  of  Physical  Working  Conditions 109-134 

V.  EDUCATION 

XI.  Training  Executives 135-152 

XII.  The  Problem  of  Foremanship 153-169 

XIII.  Training  Employees 170-188 

XIV.  The  Company  Magazine 189-198 

XV.  Arousing  Interest  in  Work 199-225 

XVI.  Transfer  and  Promotion 226-235 

XVII.  Shop  Rules,  Grievances  and  Discharge 236-250 

VI.  RESEARCH 

XVIII.  Job  Analysis  and  Job  Specifications 251-265 

XIX.  The  Supervision  and  Control  of  Job  Analysis 266-280 

XX.  The  Measurement  of  Labor  Turnover 281-290 

XXI.  Methods  of  Factory  Labor  Analysis 291-303 

XXII.  The  Labor  Audit  Check  List 304-326 

xi 


xii  CONTENTS 

VII.  REWARDS 

CHAPTER  PAGE 

XXIII.  Elements  in  Wage  Determination 327-344 

XXIV.  Payments  Plans  and  Methods 345-360 

XXV.  Meeting  the  Industrial  Risks 361-373 

VWI.  ADMINISTRATIVE  CORRELATION 

XXVI.  Coordination  of  Staff  Departments 374-395 

XXVII.  Steady  Work 396-400 

IX.  JOINT  RELATIONS 

XXVIII.  Principles  of  Shop  Committee  Organization 407-417 

XXIX.  Methods  of  Shop  Committee  Organization 418-437 

XXX.  Employees'  Associations 438-445 

XXXI.  The  Business  Value  of  the  Collective  Bargain 446-458 

XXXII.  The     Business     Value     of     the     Collective    Bargain 

(Continued) 459-480 

XXXIII.  Employers'  Associations 481-491 

XXXIV.  National  Industrial  Councils 492-51 1 

XXXV.  The  Purpose  of  Industrial  Government 512-516 

X.  APPENDIX 

Appendix.   Topical  Outline  for  Use  of  Students  in  Plant  Visits.. . .  517 

INDEX..  521 


PERSONNEL  ADMINISTRATION 

ITS  PRINCIPLES  AND  PRACTICE 


CHAPTER  I 
THE  FIELD  OF  PERSONNEL  ADMINISTRATION 

In  the  last  ten  years  one  branch  of  the  science  of  administra- 
tion has  grown  to  new  and  significant  proportions. 

The  logical  necessity  of  centering  attention  in  industry  upon 
the  effectiveness  with  which  human  labor  is  applied,  has  been 
the  basic  cause  of  a  shift  of  managerial  emphasis  which  has 
really  only  begun.  Industrial  management  is  thus  far  little 
beyond  the  threshold  of  a  new  method  and  a  new  evaluation  of 
administrative  ability.  The  new  focus  in  administration  is 
to  be  the  human  element.  The  new  center  of  attention  and 
solicitude  is  the  individual  person,  the  worker.  And  this  change 
comes  about  fundamentally  for  no  sentimental  reasons,  but 
because^  the  enlistment  of  human  cooperation,  of  the  interest 
and  goodwill  of  the  workers,  has  become  the  crux  of  the  produc- 
tion problem.^ 

The  human  approach  to  effective  production  administration  is 
through  a  specialized  administrative  agency — through  the  opera- 
tion of  a  separate  staff  department  in  management.  Present 
development  is  in  the  direction  of  a  new  science  and  a  newly 
appreciated  art — the  science  and  art  of  personnel  administration. 
To  define  and  study  this  science  is  a  necessary  project  if  indus- 
trial administration  is  to  be  sound.  To  have  insight  into  this 
art  and  skill  in  its  use  is  imperative  if  satisfactory  industrial 
relations  are  to  be  maintained. 

Clearly,  therefore,  it  is  not  a  more  penetrating  conception  of 
management  which  has  to  be  justified  or  to  prove  its  case;  it 
is  rather  managers  themselves  who  are  today  realizing  how 
large  a  share  they  must  shoulder  for  the  responsibility  which 

1 


2  PERSONNEL  ADMINISTRATION 

is  upon  us  all  for  the  confusion  and  conflict  into  which  industry 
has  fallen.  Their  share  is  large  because  they  have  been  in  a 
position  of  leadership  and  control;  they  have  often  profited 
largely  by  their  own  success;  and  they  have  been  slow  to  see 
the  thorough-going  muddle  and  atmosphere  of  hostility  into 
which  industrial  relations  have  been  plunged.  And  now,  as 
indispensable  functionaries,  industrial  executives  must  begin  to 
make  amends  for  their  omissions. 

It  would  be  untrue  to  proclaim  salvation  for  our  industrial 
community  through  good  management.  The  problem  is  not  so 
simple.  But  the  conspicuous  part  which  wise  administration 
must  play  —  especially  the  administration  of  those  affairs  directly 
touching  workers  —  in  the  upbuilding  of  a  more  stable  and 
equitable  industrial  order,  has  been  long  enough  ignored.  It 
is  distinctly  the  task  of  those  charged  with  the  function  of 
management  to  possess  themselves  of  a  point  of  view  and 
methods  which  give  promise  of  better  results. 

What,  then,  is  the  nature,  field  and  work  of  this  new  branch 
of  administration? 

A  formal  definition  is  easily  phrased,  but  to  give  full  force  to 
its  implications  will  require  explanation. 

(  Personnel  administration  is  the  direction  and  coordination  of  the 

human  relations  of  any  organization  with  a  view  to  getting  the 

\  maximum  necessary  production  with  'ri  minimum  of  effort  and 

friction,  and  with?  proper  regard  for  the  genuine  weUrbeing  of  the 


"Personnel  administration"  is  used  throughout  this  book  syn- 
onymously with  "  employment  administration,"  "  personnel 
management,"  "administration  of  human  relations,"  and  "ad- 
ministration of  industrial  relations."  And  we  shall,  in  referring 
to  the  staff  department  which  performs  this  function,  use  all  of 
these  names  interchangeably.  In  referring  to  the  administrative 
divisions  of  this  department  which  undertake  specific  work  such 
as  employment,  training,  research,  service,  etc.,  we  shall  speak 
of  them  as  "divisions,"  "bureaus"  or  "sections."  If  we  have 
occasion  to  use  the  term  "employment  manager,"  it  will  be  to 
designate  the  head  of  the  employment  division;  similarly  the 
term  "service"  or  "welfare  manager"  will  mean  the  head  of 
the  service  division. 

Personnel  Work  as  a  Managerial  Function.  —  We  desire  to 
make  clear  at  once  that  the  administration  of  personnel  affairs 


THE  FIELD  OF  PERSONNEL  ADMINISTRATION  3 

is  a  major  staff  function.  The  personnel  executive  should  be  on 
a  parity  with  the  production  executive;  and  both  should  in  turn 
be  members  of  the  executive  or  operating  committee  of  the  com- 
pany. Because/  production  means  the  application  of  human 
energy  to  materials,)  a  competent  administrative  organization 
must  contain  executives  who  are  deft  and  felicitous  in  main- 
taining cordial  human  relations,  as  well  as  experts  in  plant 
and  process. 

There  is  no  hard  and  fast  line  of  demarcation  between  the 
administration  of  production  and  the  administration  of  per- 
sonnel; both  are  aspects  of  the  management  of  the  manufacturing 
enterprise — two  halves  of  one  administrative  whole.  But  the 
personnel  branch  will  see  to  it  that  at  every  point  practical 
effect  is  given  to  the  idea  that  the  individual  worker  must  be 
treated  as  a  human  being — an  organic  unity,  whose  native 
demands  for  work,  income,  home,  family,  play,  intellectual, 
aesthetic  and  religious  expression  must  be  reasonably  satisfied. 

This  view  is,  of  course,  at  odds  with  the  conception  of  the 
"employment  manager"  who  has  no  policy-determining  power, 
no  major  executive  influence  and  authority;  who  is  in  reality 
litt|e  more  than  a  hiring  agent.  It  is  equally  at  variance  with  the 
idea  of  a  "service  worker"  or  "welfare  worker"  who  is  in  charge 
of  such  matters  as  factory  health,  rest  rooms,  home  visiting, 
social  activities  and  the  like.  Both  of  these  agents  might  in  a 
well-built  organization  be  present,  but  they  would  be  subordinate 
executives  on  the  staff  of  the  personnel  administrator. 

Too  much  importance  cannot  be  attached  to  this  initial  declara- 
tion that  the  administration  of  human  relations  is  a  major, 
executive  function.  The  professional  standing  and  the  effective 
progress  of  any  factory's  personnel  work  is  in  peril,  as  long  as 
it  is  undertaken  as  a  line  rather  than  as  a  staff,  administrative 
function.  We  hold  here  to  the  conception  of  the  administering 
of  the  human  relations  as  staff  and  administrative  work^not 
because  this  is  today  the  universally  accepted  idea,  but  because 
it  is  only  when  such  a  rounded  conception  of  the  administrative 
organization  gains  acceptance  that  any  sound  program  of  per- 
sonnel work  will  be  permanently  assured. 

It  may  be  objected,  however,  that  in  almost  all  plants  one  or 
another  of  the  major  executives  is  already  in  control  of  the 
determination  of  labor  policies.  It  is  indeed  true  that  even  where 
no  separate  personnel  function  is  explicitly  recognized,  the  per- 


4  PERSONNEL  ADMINISTRATION 

sonnel  policies  are  ultimately  decided  by  a  staff  official — usually 
the  general  manager  or  president.  But  it  is  the  lesson  of  all 
recent  developments  in  industrial  organization,  that  employ- 
ment administration  is  inherently  a  separate  major  function 
for  which  special  ability,  peculiar  aptitude  and  expert  training 
are  imperative  if  the  best  results  are  to  be  obtained  both  in 
deciding  upon  and  in  executing  policies  in  the  field  of  human 
relations.  Administration  of  the  distinctly  human  matters  like 
selection,  training,  negotiation,  decision  upon  terms  of  employ- 
ment, etc.,  is  already  being  widely  recognized  as  a  separate  branch 
of  human  knowledge.  We  are  not  necessarily  arguing  against 
having  existing  major  executives  assume  direction  over  the 
expert  administration  of  this  function.  We  are  only  empha- 
sizing the  fact  that  since  many  high  executives  are  ultimately 
in  charge  of  the  personal  and  economic  relationships,  they  should 
fully  realize  what  vital  duties  they  have  in  this  field,  what  an 
enlightened  point  of  view  is  required  and  what  an  elatx>rate 
technique  should  be  applied,  if  they  are  to  fulfil  their  respon- 
sibility for  performing  the  work  creditably. 

If,  then^personnel  work  is  managerial  in  character^and  scope, 
the  test  or  its  success  is  the  same  as  that  for  all  managerial 
work, — its  demonstrated  or  demonstrable  ability  to  result  in  a 
more  effective  application  of  labor  to  production.  In  other 
words,  this  executive  department  is  fundamentally  as  concerned 
as  any  other  in  forwarding  the  ends  of  production.  The  only 
difference  is — and  it  is  a  difference  of  great  importance — that 
its  point  of  view  as  to  how  the  ends  of  production  can  best 
be  furthered,  will  be  a  special  one.  The  personnel  manager 
approaches  the  direction  of  production  from  the  point  of  view 
of  engaging  the  workers'  interest  in  their  work.  He  comes  at 
it  as  an  expert  in  the  vitalizing  of  human  activity  and  human 
association.  For  this  very  reason  he  may  at  times  be  unable 
to  subscribe  to  proposed  policies  of  immediate  expediency  which 
are  dictated  by  motives  of  selfishness  or  profit-aggrandizement. 
His  motive  as  a  professional  expert  is  not  primarily  that  of 
profit.  His  objective  is  rather  the  following  of  his  professional 
standards  of  expert  service  and  the  offering  of  advice  as  scientific- 
ally and  humanly  sound  as  possible.  His  presence  in  the  execu- 
tive organization  is  calculated  to  assure  that  at  least  one  voice  in 
its  councils  is  speaking  with  full  competency  on  the  human  jisjK-ct. 
of  production  problem-.  ll\-  presence  should  assure  that  before 


THE  FIELD  OF  PERSONNEL  ADMINISTRATION  5 

executive  action  is  taken  full  and  adequate  weight  has  been  given 
to  psychological  and  human  considerations. 

Nothing  is  clearer  than  that  in  so  far  as  the  personnel  executive 
comes  to  regard  himself  as  a  professional  person,  he  will  find  him- 
self at  times  in  sharp  disagreement  with  the  policy  or  methods 
favored  by  other  executives.  That  will  be  in  no  way  to  his  dis- 
credit; indeed  this  is  in  a  sense  the  service  he  is  there  to  render. 
And  to  the  extent  that  his  stand  is  dictated  by  a  high  sense  of 
ethical  obligation  combined  with  a  full  and  accurate  scientific 
knowledge,  he  will  be  fulfilling  his  essential  function.  ^  He  should, 
in  fact,  be  to  a  degree  the  conscience  of  the  management;  ,not, 
as  someone  has  said  "the  conscience  of  the  factory." 

One  reason  for  stressing  the  managerial  significance  of  this 
work  is  thus  to  establish  at  the  outset  the  point  that  expenditures 
and  activities  undertaken  in  the  field  of  personnel  administra- 
tion have  in  large  part  to  be  justified  in  the  same  way  as  all 
other  managerial  expenses  and  activities.  The  question  which 
managers  should  always  put  is :  Does  any  proposed  activity  in 
the  field  of  personal  or  economic  relations  further  in  reasonably 
direct  ways  the  ends  of  truly  efficient  production?  There  is,  we 
admit,  no  arbitrary  line  which  it  is  possible  to  draw  between 
"company  activities"  and  "community  activities,"  between 
personnel  procedure  and  "welfare"  proposals.  But  the  closer 
the  corporation  confines  its  activities  and  expenses  to  those  which 
are  justified  in  the  eyes  of  management  and  men  alike  as  prac- 
tices essentially  contributing  to  production,  the  more  wholesome 
and  sound  will  its  personnel  policy  be. 

Direction  of  People. — Again,  as  our  definition  points  out, 
employment  administration  is  concerned  with  the  direction  of 
people,  and  those  activities  primarily  affecting  the  workers. 
This  fact  puts  upon  this  branch  of  the  management  a  special 
duty  of  knowing  all  there  is  to  know  about  people,  about  their 
physical  and  mental  constitution,  about  human  nature.  This 
knowledge,  in  so  far  as  it  is  available,  is  organized  in  the  sciences 
of  physiology  and  psychology.  The  administrator  must  be  fa- 
miliar with  essential  principles  in  both  fields.  But  since  the 
science  of  psychology  is  the  less  familiar  and  opens  up  a  point 
of  view  to  ward  personnel  problems  which  it  will  be  useful  to  retain 
throughout  our  study,  we  shall  present  the  outlines  of  a  psycho- 
logical approach  in  the  next  chapter.  The  value  of  such  an 
approach  is  nowhere  better  suggested  than  in  a  sentence  of  Glad- 


6  PERSONNEL  ADMINISTRATION 

stone's  which  says  that  "man  is  the  crowning  wonder  of 
creation  and  the  study  of  his  nature  the  noblest  study  the  world 
affords." 

The  Criterion  of  Productivity. — Our  definition  also  calls  for 
"maximum  necessary  production,"  as  a  part  of  the  employment 
administrator's  purpose.  At  the  present  hour  in  the  world's 
history,  it  requires  no  argument  to  prove  the  importance  to  all 
of  high  productivity.  The  world  is  probably  poorer  today  in 
the  relative  amount  of  useful  goods  in  hand  than  it  has  been  for 
some  decades.  The  comfort  of  the  entire  community  is  depen- 
dent upon  the  abundant  production  of  all.  The  case  for  high 
productivity  in  the  next  quarter  century  of  reconstruction  is 
thus  impregnable. 

But  it  is  a  criterion  to  be  applied  with  caution.  Our  machine 
system  would  be  exceedingly  productive  even  with  the  present 
equipment  if  it  were  run  to  capacity  with  true  efficiency  within 
each  producing  unit  or  plant.  Production  should  not,  and  of 
course  usually  does  not,  proceed  without  some  relation  to  a  known 
demand.  But  the  criterion  of  human  need  is  applied  less  fre- 
quently by  business  men  than  that  of  saleability  and  profitable- 
ness. There  is,  for  example,  nothing  to  prevent  the  manufacture 
of  pleasure  automobiles  for  which  there  is  a  demand  while  the 
need  in  human  and  social  terms  may  be  for  blankets  or  shoes  or 
houses.  There  is,  again,  nothing  to  prevent  an  ambitious  manu- 
facturer from  trying  to  control  ten  per  cent,  as  against  a  former 
five  per  cent,  of  the  competitive  market,  only  to  find  that  his 
added  five  per  cent,  production  does  not  get  a  ready  sale.  In 
short,  the  word  "necessary,"  is  indispensable  in  our  definition. 
It  may  not,  to  be  sure,  bo  the  immediate  function  of  the 
personnel  administrator  to  determine  the  amount  of  needed  pro- 
duction. But  such  determination  is  a  task  to  which  he  should 
intimately  be  a  party.  Until  the  management  of  every  single 
factory  knows  how  much  of  the  total  product  of  its  industry  it 
should  plan  to  make  and  dispose  of  each  year,  there  is  no  assurance 
of  regularity  of  work,  or  maximum  utilization  of  equipment. 

The  workers  have,  moreover,  a  legitimate  fear  of  unregulated 
productivity  and  of  a  blind  passion  for  output  without  regard 
for  known  needs.  Until  some  organization  which  can  get  the 
facts  about  demand  is  created,  it  will  naturally  be  difficult  to 
secure  their  fullest  interest  in  work.  Just  as  it  would  be  hard 
for  the  hot-house  worker  (even  though  he  were  well  paid  for  his 


THE  FIELD  OF  PERSONNEL  ADMINISTRATION  7 

labors)  to  be  interested  in  the  cultivation  of  his  produce  if  he 
knew  that  because  of  defective  marketing  arrangements,  it  was 
all  to  be  allowed  to  wither  on  a  railroad  siding;  so  with  the  indus- 
trial worker,  a  sense  of  the  utility  and  need  for  the  results  of  his 
labors,  is  an  increasingly  necessary  condition  of  good  workman- 
ship. 

Reducing  Effort  and  Friction. — "With  a  minimum  of  effort 
and  friction  "  implies  conscious  study  of  the  methods  of  applying 
human  energy  to  the  machinery  and  materials,  and  of  the 
methods  which  create  good  will,  understanding  and  mutual  confi- 
dence. The  employment  administrator  has  in  conjunction  with 
the  technical  production  administrator  the  job  of  seeing  that  the 
energy  of  workers  is  applied  with  greatest  effect  and  economy. 
Their  method  of  assuring  this  will  be  by  the  constant  use  of  the 
type  of  job  analysis  which  we  shall  later  discuss. 

Manifestly,  one  of  the  immediate  duties  of  the  executive  in 
this  field  is  to  reduce  personal  and  group  maladjustments, 
grievances  and  frictions.  He  must  help  create  formal  machinery 
to  treat  with  these  difficulties;  he  must  help  to  invest  the  whole 
plant  with  an  atmosphere  in  which  animosity  cannot  thrive;  he 
will  assure  that  the  terms  and  conditions  of  employment  are  such 
as  to  occasion  a  minimum  of  dissatisfaction.  "If  there  is  har- 
mony in  the  factory,"  says  the  clever  motto  of  a  piano  factory, 
"there  will  be  harmony  in  the  piano." 

The  Well-being  of  the  Personnel. — "With  proper  regard  for 
the  genuine  well-being  of  the  workers"  is  the  clause  of  our  defi- 
nition, which  perhaps  more  than  any  other,  distinguishes  this 
branch  of  management.  It  is  to  this  end  that  the  personnel 
executive  should  know  the  nature  of  people  and  the  real  content 
of  human  well-being.  He  is,  so  far  as  this  is  possible,  the  scien- 
tist in  human  nature  and  human  relationships.  Upon  his  answer 
to  the  question:  What  constitutes  well-being?  depends  his  judg- 
ment about  practical  procedure. 

Personnel  Administration  a  Permanent  Problem. — Our  defi- 
nition assumes  that  we  are  confining  ourselves  to  the  adminis- 
trative problems  of  industry.  This  is  true  only  so  far  as  concerns 
the  specific  illustrations  cited  in  this  volume.  It  is  important 
to  bear  in  mind  two  facts  in  this  connection.  First,  the  principles 
of  personnel  administration  as  herein  set  forth  will  be  found 
to  apply  to  a  considerable  extent  wherever  there  is  a  relation- 
ship of  employer  and  employed,  of  manager  and  managed. 


8  PERSONNEL  ADMINISTRATION 

We  earnestly  commend  these  principles,  not  alone  to  the  con- 
sideration of  the  managements  of  factories,  stores,  mines,  trans- 
portation companies  and  the  like ;  but  to  the  directors  of  hospitals1 
and  institutions,  to  school  boards,  and  especially  to  civil  service 
commissions  in  cities,  counties,  states  and  the  nation.  Inasmuch 
as  the  combined  employees  of  governmental  bodies  form  the 
largest  body  of  employees  in  our  country,  the  application  of  mod- 
ern employment  methods  to  problems  of  joint  relations  in  the 
civil  service  would  be  one  of  the  great  forward  steps  in  the  utiliz- 
ing of  modern  administrative  science. 

And,  in  the  second  place,  since  the  principles  of  personnel 
administration  largely  apply  wherever  there  is  a  relation  of 
manager  and  managed,  it  is  important  to  understand  that  the 
problem  exists,  at  least  in  many  of  its  aspects,  independently  of 
tiie  problem  of  ownership  in  industry.  Wherever  title  to  the 
ownership  of  industry  may  reside,  the  majority  of  the  problems 
of  directing  the  personnel  remain  the  same. 

We  urge  the  point  because  in  some  quarters  there  is  a  disposi- 
tion to  believe  that  a  change  in  the  title  of  ownership — for  example, 
to  the  government — could  of  itself  "solve  the  labor  problem." 
In  our  view  this  is  fallacious,  since  a  major  part  of  the  labor  problem 
is  from  the  point  of  view  of  the  science  of  management,  to  establish 
a  satisfactory  and  effective  working  entente  between  managers  and 
men.  The  relationship  of  director  to  directed  creates  problems 
in  human  contact,  association  and  organization,  which  are 
inherent,  permanent  and  virtually  universal. 

There  are,  we  recognize,  other  points  of  view  toward  the  em- 
ployment problem,  which  would  demand  that  the  effects  of  the 
present  basis  of  ownership  and  control  of  the  means  of  production 
be  more  fully  reckoned  with  as  a  complicating  factor  in  industrial 
government.  And  it  is  undeniably  true  that  certain  managerial 
problems  cannot  be  completely  solved  in  dissociation  from  prob- 
lems of  ownership.  The  arousing  of  interest  in  work,  for  example, 
may  be  found  upon  analysis  to  require  conditions  which  are  per- 
manently unobtainable  unless  the  workers  have  more  to  say 
than  at  present  about  the  disposal  of  the  product  and  of  tho  in- 
come from  production.  But  with  certain  important  exceptions, 
problems  of  managerial  technique  may  be  considered  separately 
from  problems  of  ownership. 

•See  VALENTINE,  R.  G.  Application  of  Principles  of  Organization  to 
Hospital  Service.  (In  Modern  Hospital,  v.  6,  p.  262-7,  Apr.,  1916.) 


THE  FIELD  OF  PERSONNEL  ADMINISTRATION  9 

Even  in  the  extreme  case  where  the  administrator  is  selected 
by  those  whose  work  he  directs,  the  problem  of  supplying  a  work- 
ing managerial  technique  remains  essentially  unchanged. 

Motives  in  Personnel  Policies. — "We  may  usefully  define  the 
future  outlook  for  personnel  administration  if  we  next  indicate 
the  familiar  types  of  controlling  motive  which  animate  corpora- 
tions in  the  field  of  personnel  policy.  There  is,  first,  the  corpora- 
tion which  still  adopts  a  belligerent,  repressive  and  domineering 
attitude  toward  its  employees.  In  such  companies  the  amount 
of  standard  employment  procedure  of  the  sort  outlined  in  this 
book  is  at  a  minimum.  From  every  point  of  view  we  believe  that 
this  neglect  will  prove  more  and  more  unwise;  all  the  evidence 
at  our  disposal  indicates  that  such  a  do-nothing  policy  is  short- 
sighted and  unbusinesslike  today. 

There  is,  second,  the  corporation  which  shrewdly  evaluates 
all  its  personnel  work  in  terms  of  the  cash  return.  If  it  can  see 
a  saving  or  an  additional  profit  in  any  procedure,  it  will  adopt  it 
unhesitatingly.  Much,  if  not  all,  of  the  procedure  of  personnel 
work  has  been  found  by  some  of  the  companies  of  this  group 
to  be  a  "good  paying  proposition."  Indeed,  we  can  unhesitat- 
ingly say  that  there  is  hardly  a  proposal  which  our  volume  ad- 
vances, which  some  one  or  more  companies  have  not  found  to 
"pay"  in  the  strict  profit  sense  of  the  word,  soon  enough  to  assure 
that  the  procedure  was  not  abandoned. 

But  there  is  still  a  third  type  of  corporation,  of  which  there  are 
significant  examples  in  every  large  section  of  our  country,  where, 
although  they  are  necessarily  concerned  to  secure  a  profit  as  a 
measure  of  their  utility  and  assurance  of  their  future  development, 
major  attention  is  being  paid  to  perfecting  the  organization  as 
an  instrument  of  production  and  public  service.  Companies 
of  this  sort  have  succeeded  in  remaining  free  from  the  control 
of  exclusively  financial  interests;  and,  recognizing  that  manage- 
ment is  an  expert,  professional  function  quite  separable  from  the 
function  of  " promoting"  or  of  investing,  they  are  seeking  to 
perfect  the  administrative  technique.  Obviously  in  such  cases 
the  professional  spirit  has  freest  play  and  the  application  of  science 
and  art  to  organization  can  be  made  most  rapidly — since  every 
experiment  has  not,  even  before  it  is  made,  to  demonstrate  its 
complete  practical  utility  and  profitableness. 

It  is  in  companies  of  this  type  that  the  most  significant  ad- 
vances in  the  personnel  field  have  been  made  and  virtually  all 


10  PERSONNEL  ADMINISTRATION 

the  experimental  work  has  first  been  done.  Not  a  few  of  the 
suggestions  which  this  book  will  offer  have  been  drawn  from  the 
efforts  of  these  pioneer  concerns.  We  feel  free  to  draw  upon 
their  experience  because  practically  all  of  their  new  efforts  have 
slowly  but  surely  been  borrowed  and  adapted  by  other  less 
adventurous  firms.  And  after  all,  what  is  needed  is  not  alone  a 
rehearsal  of  successful  past  experience  in  this  field,  but  also  a 
clear  indication  of  the  tendencies  of  development  in  the  next 
quarter  century. 

A  Professional  Standard. — Perhaps  the  most  substantial 
value  in  the  pioneering  work  of  these  companies  is  the  impetus 
it  has  given  to  establishing  personnel  administration  on  a  pro- 
fessional basis.  Indeed,  it  is  upon  the  extension  of  this  professional 
spirit  throughout  the  entire  field  of  management  that  the  future 
security,  integrity  and  effectiveness  of  personnel  administration 
depend.  For  a  professional  attitude  which  is  common  through- 
out management  means  a  readier  understanding  and  a  common 
ground  for  cooperation  among  all  executives.  The  essence  of  the 
professional  spirit,  we  take  it,  is  its  solicitude  for  the  maintaining 
of  its  professional  standards  in  the  face  of  all  odds.  And  the 
corner-stone  upon  which  all  professional  standards  rest  is  a 
motive  of  disinterested  service  for  the  common  good;  an  attitude 
in  which  attention  is  fastened  not  upon  the  reward  but  upon  the 
thoroughness  of  the  workmanship  and  the  utility  of  the  work 
done. 

Our  definition  of  personnel  management  and  the  subsequent 
discussion  of  its  principles  and  methods  should  furnish  a  rea- 
sonably clear  statement  of  the  standards  which  are  here  at  stake. 
This  profession  is  concerned  to  secure  the  maximum  necessary 
production  with  a  minimum  of  effort  and  friction,  and  with  proper 
regard  for  the  health  and  happiness  of  the  great  body  of  workers. 
If  the  reader  will  examine,  as  the  rest  of  this  lxx>k  attempts  can- 
didly to  examine,  the  implications  in  theory  and  practice  of  such 
a  professional  claim,  any  conclusions  which  we  have  reached  can 
be  left  to  take  care  of  themselves.  The  thoughtful  student  will 
inevitably  come  to  conclusions  of  his  own  which  in  the  light  of 
his  experience  may  or  may  not  square  with  ours.  They  will, 
however,  be  arrived  at  in  a  professional  spirit;  and  thus  he 
will  come  independently,  as  each  one  should,  to  an  adequate 
grasp  of  the  science  and  art  of  administering  human  relations. 
He  will  find  himself  demanding  a  wholesome  adjustment  between 


THE  FIELD  OF  PERSONNEL  ADMINISTRATION         11 

the  purposes  of  productivity,  profit,1  and  the  well-being  of  the 
personnel. 

Selected  References 

BLOOMFIELD,  DANIEL,  ED.  The  Employment  Department.  (In  Selected 
Articles  on  Employment  Management,  N.  Y.,  H.  W.  Wilson  Co.,  1919, 
pp.  149-198.) 

KENNEDY,  DUDLEY.  Functions  and  Scope  of  the  Employment  Department. 
(In  National  Assn.  Employment  Managers,  Proceedings  First  Annual 
Convention,  1919,  pp.  12-19.) 

LEISERSON,  W.  M.  Organizing  of  the  Working  Force.  (In  National 
Assn.  Employment  Managers,  Proceedings  First  Annual  Convention, 
1919,  pp.  118-124.) 

LEISERSON,  W.  M.  Relations  Between  Employer  and  Employee.  (In 
U.  S.  Bureau  of  Labor  Statistics  Monthly  Labor  Review,  v.  9,  pp.  1195- 
1204,  Oct.,  1919.) 

Rise  of  a  New  Profession.  (In  New  Republic,  v.  15,  pp.  102-3,  May  25, 
1918.) 

TEAD,  ORDWAY.  Productivity  and  Reconstruction.  (In  Public,  v.  21, 
pp.  332-334,  March  16,  1918.) 

TJ.  S.  SHIPPING  BOARD  EMERGENCY  FLEET  CORPORATION.  Organizing  the 
Employment  Department.  Philadelphia,  1918.  (Handbook  on  Em- 
ployment Management  in  the  Shipyards,  Bui.  No.  1.) 

1  Profit,  not  in  the  sense  of  excessive  earnings  for  private  investors,  but 
rather  in  the  sense  of  an  earning  power  sufficient  to  meet  all  costs  including 
a  fair  rental  charge  for  any  capital  which  it  is  necessary  to  borrow  plus 
amounts  for  the  replacement  of  worn  out  equipment,  and  amounts  for  the 
legitimate  extension  of  the  enterprise. 


CHAPTER  II 
HUMAN  VALUES  IN  INDUSTRY 

We  have  already  defined  personnel  administration  as  the  work 
of  directing  human  relations  with  an  eye  to  productivity,  good- 
will and  positive  regard  for  the  quality  of  the  life  of  all  the 
workers — regard  for  human  well-being.  Profits  and  a  stable 
working  force  may  to  a  considerable  extent  offer  a  measure  of 
the  success  of  efforts  toward  productivity  and  goodwill.  But 
human  well-being  needs  some  more  explicit  definition  and 
measure.  If  managers  in  the  field  of  industrial  relations  are  to 
work  with  maximum  effect  they  must  have  as  definite  an  idea 
as  possible  of  the  elements  in  human  well-being, — of  those 
qualities  in  individuals  which  are  native,  fundamental,  socially 
useful  and  worthy  of  fuller  release  and  development  than  they 
now  enjoy. 

In  a  word,  it  is  a  peculiarly  important  duty  of  all  who  direct 
people  to  know  all  they  can  about  human  nature  and  about  a 
standard  of  human  values  in  life  which  such  knowledge  suggests. 

At  present  in  the  absence  of  this  knowledge — or  in  the  absence 
of  its  close  application  to  economic  problems — industry  pursues 
its  own  way  with  standards  of  value  and  with  purposes  which, 
essential  as  they  may  be,  do  not  see  the  whole  purpose  of  industry; 
and  do  not,  we  believe,  square  with  all  that  is  now  known  about 
the  impulses  which  move  the  great  majority  of  people  to  act 
as  they  do. 

There  is,  however,  good  reason  to  believe  that  if  modern 
managers  will  take  time  really  to  understand  the  true  character 
of  human  beings  and  of  their  animating  motives  and  most  deep- 
seated  tendencies,  they  will  find  profound  suggestion  as  to  the 
meaning  of  human  well-being  and  as  to  the  purpose  which  in- 
dustry must  hold  as  central  for  its  most  successful  operation. 

Human  Characteristics  Unchanging. — It  is  first  useful  to 
reiterate  that  the  old  saw,  "you  can't  change  human  nature," 
is  true;  and  that  in  its  truth  lies  a  real  basis  of  hope.  For  it 
means  that  all  of  us,  regardless  of  clothes,  vocabulary,  social 

12 


HUMAN  VALUES  IN  INDUSTRY  13 

standing,  language  and  color,  need  and  desire  the  same  funda- 
mental things  in  life.  We  may  fairly  gauge  the  demands  which 
others  will  make  upon  life  by  the  demands  which  we  make — not 
necessarily  in  the  details  but  in  the  essence.  Home,  family, 
prestige,  security, — these  are  as  significant  and  influential  in 
controlling  the  life  of  the  humblest  night  watchman  as  in  ton- 
trolling  the  life  of  the  president  of  the  corporation. 

Moreover,  the  sameness  of  human  nature  means  that  the 
same  appeals  and  the  same  kinds  of  methods,  elicit  the  same 
kind  of  response.  Without  that  assurance  of  similar  character- 
istics and  similar  mental  habits,  education  would  be  impossible; 
all  types  of  association  would  be  capricious;  every  individual 
would  be  a  law  unto  himself. 

Because  people  are  in  essentials  moved  by  the  same  desires 
and  satisfied  with  the  same  activities,  there  can  be  reasonably 
confident  assurance  that  ideas,  purposes  and  aspirations  which 
do  find  a  basic  appeal,  will  also  find  a  universally  wide  appeal, 
if  only,  as  we  say,  human  nature  has  a  chance.  For  the  per- 
manence of  the  characteristics  in  the  human  equipment  does  not 
argue  against  improvement  in  individual  or  social  life.  It  argues 
rather  for  a  clear  understanding  of  those  characteristics  which 
seem  to  possess  the  most  constructive  force;  and  for  a  conscious 
effort  to  nurture  them.  For  there  are  apparently  some  tenden- 
cies in  the  human  being  which  are  today  more  useful  than  others. 
We  need,  notably,  as  a  recent  writer  has  suggested,  a  nurturing 
of  the  creative  tendencies  of  people  at  the  expense  of  the  possessive 
tendencies.  Just  what  this  means  in  terms  of  specific  endow- 
ments will  appear  only  as  we  enumerate  some  of  the  primary 
human  traits. 

Bodily  Integrity. — No  study  of  human  characteristics  can 
proceed  far  unless  it  is  grounded  in  a  knowledge  of  the  influence 
of  bodily  conditions  upon  life  and  attitude.  Behavior,  says  the 
biologist,  is  a  function  of  structure.  And  it  is  no  less  a  function 
of  the  health  of  the  organism.  Much  confusion  about  variations 
in  the  responses  of  people  to  similar  situations  is  due  to  a  failure 
to  take  account  of  differences  of  physical  condition.  Low  vitality, 
under-nourishment,  continued  over-eating  and  under-exercising, 
bad  liver  and  bad  lungs — all  modify  the  character  of  the  individ- 
ual's behavior.  And  until  managers  are  prepared  to  face  the 
problem  of  their  workers'  attitude  first  in  terms  of  bodily 
integrity,  they  will  meet  only  confusion  and  inconsistency  in 


14  PERSONNEL  ADMINISTRATION 

trying  to  foster  qualities  in  employees  which  are  dependent  for 
their  normal  existence  and  growth  upon  good  health. 

"The  basis  of  all  national  progress,  whether  industrial  or 
social,  is  the  health  and  physical  efficiency  of  the  people."  And 
the  need  and  desire  for  individual  health  and  free-flowing  vitality 
is  native  to  us  all.  The  soundness  of  any  procedure  or  of  any 
purpose  in  industry  or  in  life  depends  upon  its  ability  to  square 
itself  first  with  the  innate  demand  for  physical  wholeness. 

Love  of  Family. — Coupled  directly  with  the  reality  usually 
referred  to  as  a  tendency  toward  self-preservation,  is  an  equally 
strong  impulse  to  race  preservation,  which  expresses  itself  in  love 
of  parents,  wife  and  children.  Until  managers  realize  that  not 
only  is  this  love  just  as  strong  and  fine  and  socially  beneficent  in 
working  class  families  as  it  is  in  their  own,  but  that  it  also 
impels  workers  in  the  same  way,  they  will  be  blind  to  a  simple 
truth  which  has  significant  consequences  in  industry.1  For 
the  passionate  desire  to  see  families  not  merely  supported  but 
"getting  on,"  to  see  children  have  larger  opportunities  than 
parents  had,  helps  to  explain  much  effort  and  sacrifice. 

Indeed,  a  combination  of  these  two  tendencies — toward  self 
and  race  preservation — explains  why  the  demand  for  a  living 
wage,  for  a  progressively  higher  standard  of  living  and  especially 
for  security  of  livelihood,  is  so  insistent.  It  may  be  truthfully 
said,  we  believe,  that  the  failure  of  managers  to  satisfy  this 
demand  for  security  of  livelihood  is  at  the  bottom  of  the  bitterest 
protests  of  the  workers  against  current  industrial  practices.  The 
objection  may,  of  course,  be  urged  that  if  this  security  existed 
there  would  be  little  stimulus  to  effort — that  there  would  be 
universal  slacking. 

The  Creative  Impulse. — The  best  possible  answer  to  this  con- 
tention is  that  in  modern  industrial  life  another  native  tendency 
has  been  all  but  forgotten.  That  tendency  has  been  variously 
spoken  of  as  the  "creative  impulse,"  "the  instinct  of  workman- 
ship," the  tendency  toward  contrivance.  The  fact  behind  these 
names  is  of  tremendous  importance.  People,  especially  in  the 
temperate  climates,  prefer  activity  to  idleness;  they  prefer  ac- 
tivity to  which  use  is  imputed  or  in  the  accomplishment  of  which 
honor  and  approbation  are  to  be  gained.  They  prefer  activity 

1  For  a  fuller  treatment  than  IM  hern  possible  of  the  influrnre  in  industrial 
life  of  the  native  human  characteristics  see  TEAD,  ORDWAY,  Instincts  in 
Industry. 


HUMAN  VALUES  IN  INDUSTRY  15 

where  some  tangible  monument  of  achievement  remains.  People 
universally  have  a  passionate  desire  to  be  recognized  by  those 
around  them  as  counting  for  something.  And  they  know  that 
they  count  for  something  only  as  they  act.  The  action  may  take 
queer,  perverted  forms  because  no  direct  channels  seem  to  offer; 
but  fundamentally  the  action  which  counts  in  terms  of  self- 
satisfaction  and  of  group  approval  is  action  which  is  in  some  way 
creative. 

This  desire  to  be  creative  is  fundamental  in  human  nature. 
And  for  this  reason  failure  to  find  a  channel  for  its  expression 
may  result  in  serious  difficulties.  For  the  suppression  of  basic 
natural  tendencies  is  known  to  be  potentially  disastrous.  There 
may,  where  repression  has  been  long  and  intense,  be  varied  mani- 
festations of  suppressed  desire.  The  creative  desire  may  finally 
work  itself  out  in  destructive  ways,  or  in  trivial,  useless  ways,  or 
in  channels  and  "movements"  that  appear  not  to  be  in  line 
with  the  individual's  natural  interests.  But  that  it  will  work  out 
in  some  way,  we  know;  and  the  task  of  individuals  and  groups  is 
to  find  it  some  positive  outlet. 

The  likelihood  of  repression  and  the  fact  of  its  possible  bad 
effects,  points  again  to  the  importance  of  considering  which 
human  tendencies  should  be  most  encouraged.  For  the  sex 
instinct  and  the  desire  to  accumulate  and  to  glory  in  possession 
are  also  native;  and  it  is  essential  to  wise  social  and  industrial 
policy  to  discover  the  degree  to  which  the  energy  which  these 
impulses  represent  can  be  transferred,  rather  than  simply 
smothered  and  turned  in  upon  itself.  Each  of  these  tendencies 
contributes  to  the  integrity  of  human  nature;  but  unless  sex 
preoccupations  can  be  diverted  into  channels  where  love  of  wife 
and  children  holds  the  center  of  the  stage,  there  is  likely  to  be 
danger  ahead.  And  unless  the  pride  of  possession  and  of  ac- 
cumulation, which  may  start  with  postage  stamps  when  the  boy 
is  twelve  and  end  in  the  ownership  of  old  masters  or  heavy  stock 
holdings,  is  kept  in  proper  bounds,  the  pursuit  of  selfish  ends 
may  become  socially  intolerable. 

On  the  other  hand,  failure  to  provide  proper  channels  for 
these  two  tendencies  is  equally  dangerous.  Itinerant  workers 
who  are  permanently  "jobless,  womanless  and  voteless,"  may  be 
a  genuine  menace  to  the  stability  of  the  community.  Workers 
who  have  never  been  able  to  get  sufficiently  ahead  to  own  more 
property  than  can  be  packed  into  a  rucksack  have  not  the  same 


16  PERSONNEL  ADMINISTRATION 

sense  of  responsibility  and  participation  in  the  permanent  life  of 
the  community  that  the  man  who  owns  a  house  and  furniture 
has. 

The  problem  of  balancing  these  several  tendencies  must  depend 
in  the  last  analysis  upon  some  agreement  as  to  the  purpose  which 
industry — and  indeed  life  itself — is  to  serve. 

The  Desire  to  Possess. — There  is  undoubtedly  in  the  human 
characteristic  of  possessiveness  a  stabilizing  influence  of  con- 
siderable social  value.  If  people  can  establish  an  area  of  proprie- 
torship and  control — even  though  it  be  only  over  a  backyard 
thirty  feet  square — a  real  satisfaction  is  secured.  Things  that 
are  undeniably  "our  own"  are  a  pleasure  to  us.  It  is  probable 
that  normally  the  sense  of  ownership  is  most  stimulated  where 
the  things  possessed  are  in  actual  use  by  the  owner  and  are  the 
product  of  his  own  labors  or  the  expression  of  his  personal  choice. 

To  be  sure,  this  natural  tendency  under  modern  conditions 
can  take  perverted  and  unwholesome  turns.  But  the  impor- 
tant fact  for  industrial  experts  to  bear  in  mind  is  that  appar- 
ently possessiveness  is  a  good  quality  if  it  is  kept  in  balance  by 
other  factors  like  love  of  family,  creativeness  and  desire  for 
approval.  And  until  manual  workers  can  get  some  reasonable 
degree  of  satisfaction  for  this  tendency,  they  are  being  deprived 
of  benefits  and  enjoyments  to  which  they  are  entitled.  The 
unfortunate  truth  seems  to  be,  moreover,  that  all  groups  in  the 
community  have  today  so  translated  all  values  into  cash  terms 
that  material  possession — or  the  symbols  of  it — is  an  unduly 
conspicuous  factor  in  securing  social  approval. 

The  Value  of  Curiosity. — A  further  desire  of  human  beings 
is  to  know.  Curiosity  is  native;  and  the  word  "why"  comes 
naturally  to  the  lips  of  those  who  have  not  too  often  been  dis- 
couraged by  receiving  no  intelligible  answer  to  their  questions. 
Generally  speaking,  people  do  what  they  have  to  do  better  when 
they  know  why  they  do  it.  There  is  a  fundamental  connection 
in  the  human  mind  between  conduct  and  knowledge,  as  well  as 
between  conduct  and  impulse.  It  is  true  that  conduct  is  largely 
impulsive;  but  the  hope  of  getting  any  direction  into  it,  of  securing 
some  sensible  selection  by  the  individual  of  socially  useful  activi- 
ties, is  in  getting  him  to  "know  better."  To  know  better  is  to 
have  in  one's  mind  an  accumulation  of  past  experience  of  one's 
self  and  of  others  in  similar  situations,  and  knowledge  also  of 
how  the  experiences  "came  out."  Intelligent  conduct,  in  short, 


I 


Engl.  Sem.  Frankfurt  M. 

Auileihbibliothek 


HUMAN  VALUES  IN  INDUSTRY  17 

is  conduct  in  which  a  course  of  action  is  pursued  similar  to  that 
course  found  by  previous  selection  from  among  similar  alterna- 
tives to  bring  a  better  adjustment  of  the  individual  to  his 
surroundings. 

Indeed,  the  hope  of  improving  the  quality  of  people's  choices 
in  the  ordinary  problems  of  life  lies  in  cultivating  this  natural 
desire  to  know.  This  increasing  knowledge,  this  making  avail- 
able to  the  individual  in  organized  form  the  best  experience  of 
the  past,  is  the  essence  of  education.  And  managers  who  ignore 
the  place  that  education  and  an  educational  motive  should  play 
in  industry  are  losing  the  value  of  a  nurture  which  is  in  reality 
the  indispensable  condition  of  any  progress. 

The  Desire  for  Association. — A  further  active  desire  of  people  is 
to  associate  with  their  kind,  particularly  with  people  whose  out- 
look and  purposes  are  similar  to  theirs.  Modern  industry  re- 
quires an  unprecedented  amount  of  association  and  cooperation; 
but  much  of  it  is  enforced.  People  cooperate  in  factories  not 
because  they  want  to,  but  because  they  must  on  pain  of  fore- 
going a  livelihood.  The  problem  of  rendering  this  association 
a  voluntary  and  willing  one  is  urgent  because  it  is  in  association 
which  is  reasonably  self-initiated  and  spontaneous  that  the  most 
effective  work  is  done  and  the  most  pleasurable  atmosphere 
prevails. 

Shop  committees  and  labor  organizations,  whatever  their  other 
values  or  dangers,  are  unquestionably  an  asset  in  satisfying  this 
elemental  yearning  for  comradeship.  And  there  are  evidences 
today  that  whenever  the  desire  to  create  and  the  desire  to  asso- 
ciate can  be  coupled  with  people's  naturally  eager  search  for  the 
approval  of  their  fellows,  there  is  a  strong  and  irresistable  con- 
centration of  human  sentiment  which  is  effective  in  swinging  any 
program  to  which  the  people  involved  may  set  their  hand. 

It  is  because  the  desire  to  associate  is  so  innate  that  the  demand 
for  the  approval  of  those  with  whom  we  associate  is  also  domi- 
nant. Indeed,  if  properly  used  this  desire  to  be  thought  well  of 
by  our  fellows  is  an  immensely  constructive  force.  Much  that 
we  speak  of  as  the  conventions  of  society  is  nothing  more  than 
crystallized  attempts  to  organize  the  approval  of  men  in  behalf 
of  those  ways  of  acting  which  past  generations  believed  to  be 
safe  or  wise.  And  the  problem  that  confronts  us  at  every  turn 
in  industrial  life  is  how  to  organize  the  approval  of  fellow  workers 

of  head  and  hand,  and  the  approval  of  consumers,  so  as  to  offer 
2 


18  PERSONNEL  ADMINISTRATION 

a  legitimate  and  important  stimulus  to  useful  effort.  For  it 
becomes  increasingly  clear  that  it  is  not  money  or  the  pay  en- 
velope that  stands  at  the  center  of  the  thinking  of  owners, 
managers  and  workers;  it  is  the  honor  and  standing  which  comes 
with  the  monetary  return. 

The  Desire  for  Approval. — More  passionately  than  almost 
anything  else  people  desire  to  be  thought  well  of  by  those  whose; 
opinion  they  value.  It  seems  indeed  as  if  this  yearning  for 
approval  was  only  a  diluted  form  of  some  tendency  even  more 
basic — a  tendency  to  give  and  receive  generous,  disinterested 
affection  and  regard  between  man  and  man.  But  even  this 
tendency  has  its  definite  basis,  and  it  can  only  be  fostered 
if  its  sources  are  properly  understood.  Goodwill  and  actual 
warmth  of  intercourse  between  individuals  and  between  groups 
depends  upon  three  things;  upon  personal  acquaintance,  a  full 
knowledge  of  people's  motives  and  achievements,  and  upon  a 
definite  attempt  to  organize  the  approval  of  people  around  the 
sentiment  of  friendship  and  the  attitude  of  mutual  trustfulness. 
And  if  it  is  true  that  people  fundamentally  desire  not  only  ap- 
proval but  affection,  there  is  a  suggestion  here  as  to  the  value 
of  widening  and  deepening  the  quality  of  personal  relationship 
in  industry,  which  has  thus  far  been  untapped  and  unsuspected. 

The  Desire  for  Justice. — Related  to  the  desire  for  knowledge 
and  for  approval  is  a  deep  desire  for  justice.  Contradicto:  y  as 
may  be  the  forms  which  this  demand  takes  from  decade  to  decade, 
men  are  still  eagerly  searching  and  are  still  never  satisfied  until 
relationships,  institutions  and  opinions  seem  to  them  "just." 
The  appeal  of  the  "square  deal"  has  not  been  in  any  definition 
or  specific  application  which  it  ever  received,  but  in  the  universal 
demand  of  people  that  in  so  far  as  they  have  knowledge  about  a 
situation,  "fairness"  shall  prevail. 

As  applied  to  the  industrial  problem,  this  idea  of  fair  play  is, 
of  course,  especially  baffling,  but  there  do  seem  to  be  emerging 
several  ideas  which  lend  it  definiteness.  That  there  should  be 
some  approximate  relation  between  expenditure  of  effort  and 
reward  is  now  thought  to  be  "fair."  That  passive  ownership 
is  sufficient  justification  for  the  receipt  of  income  is,  conversely, 
being  increasingly  thought  to  bo  "unfair."  That  full  authority 
over  shop  affairs  and  terms  of  employment  should  be  vested  in 
the  management  alone,  is  also  being  questioned  by  many  as 
"unfair."  That  the  continuance  and  extension  of  tho  basic, 


HUMAN  VALUES  IN  INDUSTRY  19 

essential  industries  should  depend  upon  the  willingness  of  priv- 
ate investors  to  lend  money,  is  another  condition  which  some 
groups  in  the  community  believe  "unfair." 

Love  of  Beauty. — There  is  a  similarly  indefinable  characteristic 
of  people  in  their  desire  for  esthetic  satisfaction.  Groupings 
of  line,  color,  form  and  sound  which  are  felt  to  be  "beautiful" 
are  profoundly  satisfying  and  a  source  of  great  refreshment. 
Yet  beyond  this  general  statement  it  is  difficult  to  go  because 
esthetic  standards  are  so  divergent. 

A  knowledge  of  "the  best  that  has  been  thought  and  said  in 
the  world,"  is  within  limits  a  source  of  individual  enjoyment; 
and  we  find  mind  meeting  mind  and  spirit  rising  to  greet  spirit 
back  over  the  centuries  in  a  way  that  indicates  a  common  yearn- 
ing after  the  fine  things  of  the  intellect  and  the  spirit.  So  that 
varied  as  esthetic  standards  may  be,  we  do  find  a  desire  for  beauty 
as  native  and  permanent  as  a  desire  for  "justice"  and  "truth." 

Love  of  Goodness. — Yearning  for  "goodness"  or  "righteous- 
ness, "  vague  and  sporadic  as  it  may  often  be — covered  over  by 
more  immediate  claims,  set  at  naught  by  the  paralyzing  effects  of 
some  fear — is  still  a  historic  fact  in  human  experience;  and 
historically  also  it  has  usually  been  identified  with  some  "reli- 
gious" sanction.  This  desire  has  thus  far  been  expressed  largely 
in  terms  of  individual  conduct.  And  there  has  until  recently 
been  little  attempt  to  reconcile  ethical  demands  upon  groups  with 
those  made  upon  individuals.  But  as  the  sense  of  ethical  obli- 
gation for  right  conduct  spreads  to  include  group  behavior, 
managers  will  witness  a  release  of  power,  energy  and  goodwill, 
which  is  today  unthought  of.  And  they  must  definitely  reckon 
with  the  increasing  part  which  the  passion  for  righteousness 
and  the  demand  for  righteousness  reenforced  by  religious  sanc- 
tion, will  play  in  the  thought  of  workers  and  consumers,  as  well 
as  among  themselves.  For  the  concrete  expression  which  such 
a  sentiment  finds  is  in  human  cooperation,  fellowship  and  fra- 
ternity, in  public  service  and  efforts  for  the  common  good. 

The  Unifying  Factor. — Human  nature  is  the  manifestation  of 
the  interaction  of  these  and  other  elements  and  characteristics. 
Human  desire  covers  a  range  extending  from  essential  physical 
needs,  to  more  generalized  demands  of  impulse,  to  intellectual, 
moral  and  spiritual  desires.  All  have  to  be  reckoned  with;  all 
have  a  place. 

But  the  human  personality,  manifold  as  are  the  forms  of  its 


20  PERSONNEL  ADMINISTRATION 

expression,  is  not  simply  a  battleground  for  conflicting  impulses. 
Unifying  tendencies  are  at  work;  organization  of  the  individual's 
impulsive  life  is  not  merely  necessary,  it  is  as  native  to  human 
beings  as  thought  itself.  And  there  are  indications  that  society 
will  realiee  the  promise  of  personality  only  as  it  understands  how 
potentially  fine  and  generous  are  people's  strongest  and  most 
elementary  tendencies.  The  human  tendencies  which  are  seek- 
ing wider  and  wider  expression  and  which  bring  harmony, 
release  antl  happiness  are  the  positive  characteristics  of  love  of 
family,  of  association,  of  creation,  of  group  approval.  Personality 
is  thus  translatable  into  terms  of  individual  quality,  into  terms 
of  fullness  of  life,  forebearance,  generosity,  creative  power, 
comradeship  and  love. 

In  a  word,  upon  examination  personality  is  found  to  contain 
within  itself  its  own  penetrating  suggestion  as  to  human  purposes. 
Personality  thus  becomes  an  end  in  itself;  the  integrity  of  the 
individual  life  and  the  maximum  improvement  in  its  quality  are 
permanently  valid  objectives.  For  out  of  human  nature  spring 
all  the  positive  energies  which  in  their  expression  satisfy  the  indi- 
vidual and  contribute  to  social  upbuilding.  The  fulfillment 
of  personality  is  the  liberation  in  the  individual  of  those  native 
qualities  which  make  him  free,  active  and  energetic,  and  which 
because  of  this  freedom  make  him  also  willing  and  happy  in 
those  activities  which  have  social  utility.  Personality  is  essen- 
tially a  social  product.  It  is  the  best  possible  life  of  the  individ- 
ual manifesting  itself  as  a  contributing  force  in  the  common 
life  of  the  community.  Self  advancement  and  social  advance- 
ment are,  in  short,  but  two  aspects  of  one  fact — the  fact  of  indi- 
vidual realization. 

It  is,  we  conclude,  a  sufficient  and  lofty  purpose  in  life  to  strive 
for  the  development  of  as  many  individuals  as  possible  into  fine, 
free,  generous,  serene  and  happy  human  beings.  No  one  has 
ever  excelled  the  compactness  and  directness  of  Aristotle's  defi- 
nition of  the  ultimate  in  life  when  he  characterizesAiappiness  as 
"an  activity  of  the  soul  in  the  direction  of  excellence  in  an  un- 
hampered life."^ 

This  ultimate  aim  cannot  be  too  explicit.  (The  individual 
in  this  view  "is  the  home  and  center  of  all  values."  ^And  "tho 
end  of  all  moral  effort  is  the  production  of  a  worthy  type  of 
personality,  an  inner  life,  rich  and  noble  in  content."1 

1  EVERETT,  WALTER  G.     Moral  Values,  pp.  227;  247. 


HUMAN  VALUES  IN  INDUSTRY  21 

Personality  in  Industry. — Reinstatement  of  the  human  per- 
sonality as  the  central  value  in  life  has  a  significance  for  industry 
which  it  is  impossible  to  ignore.  It  implies  that  as  a  condition 
for  the  development  of  the  individual,  there  must  exist  a  reason- 
able freedom  for  choice  of  work,  for  leisure,  for  growth,  for 
free  association,  for  exercise  of  the  whole  gamut  of  human 
faculties. 

/  Industrial  practices  are,  in  other  words,  to  be  judged  in  terms 
6T  their  effect  on  human  beings.  If  personality  is  central  in 
life,  then  it  is — or  should  be — central  in  industry.  Surely, 
managers  and  workers  are  not  carrying  on  their  labors  for  the 
sake  of  "industry."  Industry  is  being  carried  on  for  the  sake 
of  people — the  people  in  it  and  the  people  whose  needs  it  serves. 
And  the  profession  of  management,  especially  in  its  personnel 
branch,  has  a  major  task  of  understanding  this  purpose,  this 
natural  and  sensible  emphasis  upon  the  human  values  as  central 
in  the  world's  economic  life.  The  department  of  personnel  is 
indeed,  as  someone  has  well  characterized  it,  the  department 
of  personality. 

In  the  light  of  present  day  labor  problems  and  of  contempo- 
rary knowledge  about  human  characteristics,  the  need  for  a 
redefinition  of  standards  of  factory  procedure  and  for  a  new  state- 
ment of  purposes  in  industry,  is  only  too  apparent.  Happily 
it  is  now  being  increasingly  acknowledged  that  human  beings 
natively  and  fundamentally  prefer  doing  good  to  doing  ill,  prefer 
creating  to  destroying,  prefer  approval  to  disapproval,  prefer 
love  to  hate  and  happiness  to  misery.  And  industry,  if  it  is  to 
develop  in  the  light  of  these  human  needs  and  desires,  must  come 
to  that  simple  but  essential  truth — that  human  beings  are  of 
primary  value  in  life. 

The  purpose  of  industry  is  to  make  needed  goods — in  sufficient 
quantity  and  at  moderate  cost.  But  more  fundamentally  the 
purpose  of  industry  is  to  enhance  human  happiness.  And  until 
industrial  managers  set  themselves  to  reconcile  these  two  pur- 
poses there  will  be  conflict  and  misunderstanding  not  only  be- 
tween managers  and  men  but  in  the  minds  of  managers  themselves. 

It  is  a  matter  for  congratulation  today  that  such  a  reconciliation 
gives  promise  of  being  realized.  But  it  will  be  possible  only 
when  there  is  wide  recognition  that^  personality  is  a  supreme 
value  in  life,  j 


22  PERSONNEL  ADMINISTRATION 

Selected    References 

EVERETT,  W.  G.     Moral  Values,  a  Study  of  the  Principles  of  Conduci 
N.  Y.,  Holt  &  Co.,  1918.     Ch.  7. 

JAMES,  WILLIAM.     Psychology.     N.  Y.,  Holt  «fe  Co.,  1907. 

McDouGALL,  WILLIAM.  Introduction  to  Social  Psychology.  9th  ed. 
London,  Methuen  &  Co.,  Ltd.,  1915. 

PARKER,  C.  H.  The  Casual  Laborer  and  Other  Essays.  N.  Y.,  Harcourt, 
Brace  &  Howe,  1920. 

PARMELEE,  M.  F.  Science  of  Human  Behavior;  Biological  and  Psy- 
chological Foundations.  N.  Y.,  Macmillan  Co.,  1913. 

RUSSELL,  BERTRAND.  Why  Men  Fight.  N.  Y.,  Holt  &  Co.,  1917, 
pp.  3-41. 

TEAD,  ORDWAY.  Instincts  in  Industry;  a  Study  of  Working-class  Psy- 
chology. N.  Y.,  Houghton,  Mifflin  Co.,  1918. 

THORNDIKE,  E.  L.  Original  Nature  of  Man.  (In  his  Educational  Psychol- 
ogy, 1913-14,  v.  1).  N.  Y.,  Teachers  College,  Columbia  University. 

WALLAS,  GRAHAM.  The  Great  Society.  N.  Y.,  Macmillan  Co.,  1919,  pp. 
235-369. 

WEEKS,  A.  D.  Psychology  of  Citizenship.  Chicago,  A.  C.  McClurg  it 
Co.,  1917.  Ch.  5  and  6. 

WOLF,  R.  B.  Individuality  in  Industry.  (In  U.  S.  Bureau  of  Labor 
Statistics  Bid.  227,  1917,  pp.  193-206).  Employment  Managers' 
Conference,  Philadelphia,  Pa.,  Apr.  2  and  3,  1917. 


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CHAPTER  III 
THE  REASONS  FOR  A  PERSONNEL  DEPARTMENT 

As  intimated  in  our  first  chapter,  the  fundamental  reason  for 
the  development  of  a  separate  administrative  division  for  the 
^direction  of  the  human  relations  is  a  growing  recognition  that 
v  people  are  endowed  with  characteristics  different  from  those  of 
machines Jbr  of  raw  materials.     And  if  people  are  to  be  directed 
in  ways  which  give  best  results,  that  direction  must  be  special- 
ized just  as  direction  in  the  other  major  fields  of  management 
has  been  specialized. 

The  Division  of  Labor. — The  case  for  specialized  administra- 
tion has,  first,  its  historical  setting.  The  development  of  power 
driven  machinery  has  meant  the  division  and  sub-division  of 
operations  until  the  tending,  feeding  and  "minding"  of  machines 
becomes  a  significant  proportion  of  all  the  work  required  in  a 
factory.  It  is  dangerous  to  over-generalize  on  this  point;  but  it 
is  still  too  largely  true  that  this  division  of  labor  has  tended  to 
remove  interest  and  significance  from  the  work  done  to  an  alarm- 
ing degree.  "It  is  possible  for  any  man  or  woman  to  go  into  a 
factory  and  in  a  day  or  week  become  an  acceptable  operator  and 
earn  a  desirable  week's  pay.  In  fact,  the  entire  tendency  in 
industry  has  been  to  place  a  premium  upon  the  uneducated 
worker."1 

Under  such  conditions,  where  there  is  only  conformity  to  the 
demands  of  a  machine,  particularly  where  workers  remain  at 
such  narrowing  processes  against  their  will,  the  human  costs 
have  obviously  been  heavy. 

„  "If  the  machine  tender,"  declares  Hobson,  "could  become  as 
automatic  as  the  machine,  if  he  could  completely  mechanize  a 
little  section  of  his  faculties,  it  might  go  easier  with  him.  But 
the  main  trend  of  life  in  the  man  fights  against  the  mechanizing 
tendency  of  his  work,  and  the  struggle  entails  a  heavy  cost.  For 
his  machine  imposes  a  repetition  of  the  same  muscular  and  nerv- 

1  LINK,  H.  C.     Employment  Psychology,  p.  382. 

23 


24  PERSONNEL  ADMINISTRATION 

ous  action  upon  a  being  whose  muscles  and  nervous  system  are 
continually  changing."1 

The  personnel  director  finds  an  important  task  awaiting  him  in 
this  field.  Study  and  experiment  are  needed  to  discover  how 
certain  factory  work  can  be  so  further  mechanized  as  completely 
to  eliminate  the  need  for  monotonous  "feeding"  jobs,  and  to 
institute  a  variety  of  other  compensatory  activities  to  offset 
the  results  of  highly  repetitive  work. 

The  Corporate  Form  of  Management. — The  corporate  form  of 
management  which  has  extended  rapidly  in  the  last  half  century, 
has  also  tended  to  develop  an  impersonalism  in  the  relationship 
of  different  groups  of  workers  which  has  its  dangers  both  to 
productive  efficiency  and  to  human  happiness.  An  important 
reason  why  results  in  securing  economies  in  large  scale  plants 
have  never  realized  people's  expectations  is  that  this(impersonal- 
ism  has  helped  to  create  complete  indifference  about  the  results 
of  their  work  in  the  minds  of  the  manual  workers  and  even  of  the 
lower  executives^;  There  has  been  an  attitude  that  since  they 
were  working  for  a  big  and  rich  company  economy  was  no  object; 
that  since  they  got  relatively  small  pay  they  would  give  relatively 
slight  return  in  quantity  and  quality  of  work.  In  addition  to  the 
disintegrating  effect  of  this  natural  reaction  must  be  considered 
the  weakness  of  long  range  and  absentee  management ;  for  there 
has  not  yet  evolved  a  technique  of  combining  centralized  control 
with  sufficient  local  autonomy  to  overcome  the  obvious  limita- 
tions of  management  by  fiat  rather  than  by  personal  knowledge. 
And  the  result  in  a  lax,  careless  and  indifferent  attitude  among  the 
rank  and  file  is  almost  inevitable. 

To  counteract  these  aggregate  effects  of  long  range  and  large 
scale  management  a  deliberate  and  a  comprehensive  program  is 
necessary;  a  program  based  on  a  recovery  of  personal  contacts  and 
personal  acquaintance  between  managers  and  men. 

There  is,  of  course,  a  limit  which  is  quickly  reached  to  the  num- 
f  ••  T  of  persons  that  one  can  know  by  name  and  know  in  a 
way  that  makes  it  possible  to  reckon  with  the  individual's 
special  qualities  and  limitations.  Yet  it  is,  in  the  last  analysis, 
upon  a  sense  of  personal  relationship  and  upon  a  knowledge  and 
utilization  of  individual,  special  abilities  that  harmonious  pro- 
ductive working  relations  in  large  part  depend. 

Already  a  degree  of  personal  relationships  between  some  one 

1  HOBSON,  J.  A.     Work  and  Wealth,  p.  61. 


REASONS  FOR  A  PERSONNEL  DEPARTMENT  25 

in  the  management  and  each  worker  has  inevitably  to  exist; 
and  it  is  usually  a  foreman  or  his  assistant  who  stands  as  the 
personal  link.  But  as  soon  as  the  need  for  expert  selection, 
training  and  negotiation  over  terms  of  employment  is  seen,  the 
necessity  for  personal  knowledge  and  association  on  the  part  of 
other  executives  than  foremen  becomes  apparent.  And  the 
staff  which  is  brought  in  to  carry  on  these  activities  of  personal 
contact  and  adjustment  is  in  fact — whatever  its  name  may  be 
— a  personnel  department. 

In  short,  both  in  the  shop  and  in  the  executive  councils  of  large 
organizations  the  need  for  knowledge  of  the  individual  workers 
and  for  a  sense  of  corporate  unity  can  be  met  only  as  there  is 
deliberate  intention  in  these  direction.  And  it  is  the  experience 
of  many  corporations  that  this  deliberate  intention  is  never 
realized  until  there  is  in  the  management  a  department  spe- 
cially devoted  to  studying  and  applying  expertly  the  methods  of 
restoring  a  sense  of  personal  association  among  all  workers  in 
the  organization. 

It  is  frequently  argued  that  the  existence  of  a  high  labor 
turnover  is  a  reason  for  having  a  personnel  department.  That 
may  indeed  be  the  immediate  occasion  of  its  introduction.  But 
since  turnover  among  workers  is  itself  only  a  symptom  of  other 
maladjustments,  it  will  be  more  accurate  to  say  thaKj/he  need 
for  scientific  and  personal  adjustment  of  the  individual  worker 
to  his  job  and  to  the  organization  is  reflected  in  the  high  labor 
turnover  which  so  frequently  exists.") 

Development  of  Administrative  Science. — The  development 
of  scientific  knowledge  and  standard  methods  of  procedure  in 
the  several  branches  of  industrial  administration  has  tended 
directly  to  show  the  need  for  a  scientific  approach  to  the  per- 
sonnel aspects  of  administration.  And  a  growing  conviction  that 
scientific  methods  were  applicable  to  problems  of  human  relations 
has  led  naturally  to  a  study  of  the  science  of  psychology.  For, 
as  we  have  shown  in  the  previous  chapter,  students  of  manage- 
ment have  come  in  recent  years  to  see  that  this  science  can  yield 
substantial  evidence  as  to  the  nature  of  people  and  the  typical 
modes  of  their  behavior. 

On  the  one  hand,  therefore,  a  growing  body  of  knowledge  about 
people  and  their  behavior,  their  motives,  impulses,  and  desires, 
leads  to  a  belief  that  managers  can  discover  and  apply  methods 
which  are  relatively  scientific  and  human  in  industrial  relations. 


26  PERSONNEL  ADMINISTRATION 

And  on  the  other  hand,  the  growth  of  elaborate  technique 
in  the  fields  of  sales,  production  control  and  accounting  has 
pointed  the  way  toward  what  might  be  done  in  the  field  of  per- 
sonnel. Accounting,  for  example,  beginning  with  simple  book- 
keeping origins,  has  elaborated  a  method  of  cost  analysis  which 
now  becomes  one  of  the  means  of  showing  managers  their  wastes 
and  losses  in  the  application  of  the  working  force  to  the  equip- 
ment. l  By  knowing  the  amount  of  idle  time  at  machines  due  to 
irregular  work,  poor  training,  improper  handling  of  machinery 
and  the  like,  the  accountant  has  built  up  an  unanswerable  case 
for  careful  selection  of  workers,  for  their  systematic  training,  for 
specialized  machine  maintenance  and  the  like. 

Again,  the  engineer  who  has  organized  a  factory's  flow  of  work 
by  means  of  a  new  staff  department  to  plan,  schedule  and  route 
the  work  from  process  to  process,  can  bring  a  strong  case  for 
more  knowledge  about  the  time  it  takes  workers  to  perform  a 
job.  He  points  out  from  his  special  angle  the  need  for  competent 
foremanship  to  keep  the  flow  of  work  up  to  schedule,  for  proper 
instruction  to  get  uniform  methods  of  handling  and  delivering 
worlv  And,  if  possessed  of  a  little  imagination ,  he  may  even  argue 
that^the  working  efficiency  of  the  plant  is  affected  adversely  by 
ungenerous  terms  of  employment  and  failure  directly  to  seek 
the  goodwill  of  employees.'') 

In  other  words,  not  only  is  administrative  science  in  industry 
daily  becoming  more  highly  functionalized;  but  each  of  the 
new  specialties  has  its  evidence  as  to  the  need  for  functionalizing 
on  the  human  and  personal  side.  For  executives  in  every  field 
are  coming  increasingly  to  see  that  the  source  of  efficiency, 
economy  and  goodwill  which  is  particularly  elusive  and  at  the 
same  time  peculiarly  critical,  is  the  attitude  with  which  the 
individual's  and  group's  energies  are  applied  to  the  job.  Mechan- 
ical perfection  without  the  human  consent  of  those  who  run 
the  mechanism  is  no  more  effective  than  a  scissors  with  only 
one  blade.  There  is  vital  necessity  for  actively  enlisting  and 
inspiriting  the  working  force.  The  workers  must  cooperate. 
And  the  difference  between  their  enforced  consent  and  their  en- 
thusiastic cooperation  may  well  be  the  measure  of  the  value  of  a 
new  administrative  department  specializing  in  human  relations. 

Recent  Growth  of  Functional  Management  in  Personnel 
Activities. — Moreover,  there  has  in  the  last  decade  been  a  growing 

1  Sec  GANTT,  HENRY  L.    Organizing  for  Work.    Ch.  III. 


REASONS  FOR  A  PERSONNEL  DEPARTMENT  27 

recognition  by  managers  that  in  one  field  or  another,  depending 
upon  their  special  needs,  personnel  activities  were  essential  and 
profitable.  The  movement  for  vocational  guidance  was  closely 
related  in  its  early  days  to  the  movement  for  careful  selection  of 
workers  by  special  employment  departments. 

The  movement  for  vocational  training  and  for  corporation 
school  training  was  another  distinct  influence  which  developed 
independently  and  brought  many  large  corporations  to  see  tho 
need  for  improved  instructional  methods. 

The  safety-first  movement,  again,  had  its  own  appeal  and  grew 
as  a  separate  branch  of  management  effort. 

Collective  bargaining  and  shop  committee  dealings  were 
also  developed  in  many  plants  under  the  pressuie  of  the  local 
situation  rather  than  in  response  to  any  organized  program  of 
personnel  procedure. 

And  it  is  only  in  recent  years  that  any  considerable  number  of 
managers  have  come  to  see  that  these  several  special  growths  are 
really  all  parts  of  one  big  staff  function  and  should  logically, 
therefore,  all  be  grouped  under  it. 

The  war  unquestionably  hastened  this  integrating  process  in 
many  plants  and  crystallized  in  the  minds  of  many  students 
of  the  science  of  management  a  conviction  that  this  integra- 
tion was  a  sound  development.  The  need  for  strictest  economy 
in  the  use  of  workers  during  the  war  caused  all  managers  to  be 
far  more  open  minded  and  experimental  about  a  self-consistent 
policy  of  personnel  administration  than  they  would  otherwise 
have  been.  And  in  consequence  personnel  executives  were 
secured  and  executives  trained  in  personnel  methods  on  a  scale 
which  had  not  formerly  been  contemplated  even  by  the  most 
enthusiastic  exponents  of  the  idea.  It  should  be  added,  however, 
that  by  no  means  all  of  these  new  executives  are  personnel 
managers  in  the  sense  defined  in  our  first  chapter.  Yet  this 
is  not  surprising  when  one  considers  how  relatively  few  execu- 
tives were,  or  yet  are,  thoroughly  competent  to  assume  the 
position  of  personnel  manager.  We  are  faced  admittedly  with  a 
comparatively  new  synthesis;  for  the  idea  that  the  special 
work  of  selecting,  training,  negotiating  with  and  maintaining  a 
working  force,  should  be  made  the  responsibility  of  one  staff 
department,  is  comparatively  new. 

Conclusion.— ^The  case  for  the  personnel  department  rests, 
in  summary,  upon  economic  and  upon  psychological  grounds.^ 


28  PERSONNEL  ADMINISTRATION 

The  economic  grounds  have  to  do  with  the  structure  of  modern 
industiy  and  the  modern  corporation,  with  the  natuie  of  proc- 
esses under  present  machine  conditions,  and  with  the  need  for 
specialized  attention  to  problems  like  selection  and  training. 

The  psychological  grounds  have  to  do  with  the  interest,  en- 
thusiasm and  goodwill  of  the  workers,  with  their  demand  for 
security  of  employment  and  fairness  of  treatment,  with  that 
subtle  but  growing  conviction  that  they  must  have  a  new  status 
in  industry. 

To  say  which  of  these  two  grounds  offers  the  stronger  case 
for  reorganization  in  the  administration  of  human  relations  is 
impossible.  But  it  is  manifestly  true  that  in  a  majority  of  cor- 
porations production  is  today  affected  adversely  not  so  much 
because  of  technical  inadequacies  as  because  of  the  failure  of 
managers  to  recognize  that  workers  are  human  beings  who 
demand  the  considerate  treatment  which  only  intelligence  and 
insight  regarding  human  nature  can  suggest. 

Selected  References 

GANTT,   H.  L.     Organizing  for  Work.     N.   Y.,  Harcourt,  Brace  A  Howe, 

1919. 
GREAT   BRITAIN.     MINISTRY    OF  RECONSTRUCTION.     Interim    Report  of 

the  Committee  on  Adult  Education.     Industrial  and  Social  Conditions 

in  Relation  to  Adult  Education.     London,  H.  M.  S.  Office,  1918. 
\/   HOBBON,  J.  A.     Work  and  Wealth;  a  Human  Valuation.     N.  Y.,   Mac- 

millan  Co.,  1916.     pp.  44-59,  72-78. 
\)r  HOBHON,  J.  A.     Evolution  of   Modern   Capitalism,  a  Study   of    Machine 

Production.     New    ed.     N.    Y.,   Charles  Scribner's  Sons,    1917,   pp. 

317-351. 
t^'HoBeoN,  J.  A.     Industrial  System;  an  Enquiry  into  Earned  and  Unearned 

Income.     N.  Y.,  Longmans,  Green  &  Co.,  1909,  pp.  302-324. 
LAUCK,    W.    J.    and    EDOAR    SYDENSTRICKER.     Conditions    of   Labor  in 

American  Industries.     N.  Y.,  Funk  &  Wagnalls  Co.,  1917. 
"~  LINK,   H.  C.     Employment  Psychology.     N.   Y.,   Macmillan  Co.,  1919, 

pp.  112-122. 
PARKER,  C.  H.     Technique  of  American  Industry.     (In  Atlantic  Monthly, 

v.  125,  pp.  12  22,  Jan.,  1920.) 
SOCIETY  or  INDUHTRIAL  ENGINEERS  AND  WEHTERN  EFFICIENCY  SOCIETY. 

Proceedings  of  the  National  Conference  on  Labor  I*roblems  under  War 

Conditions  held  at  Chicago,  March  27-29,  1918.     Chicago,  Society  of 

Industrial  Engineers,  1918. 
lX  TAYLOR,  F.  W.     Principles  of  Scientific  Management.     N.  Y.,  Harper  & 

Bros.,  1916. 
VKBLEN,  THORHTEIN.     Instinct  of  Workmanship.     N.  Y.,  B.  W.  Huebuch, 

1918,  pp.  299-355. 


REASONS  FOR  A  PERSONNEL  DEPARTMENT 


29 


VEBLEN,  THORSTEIN.     Theory   of   Business   Enterprise.     N.    Y.,   Charles 

Scribner's  Sons,  1917,  pp.  5-19,  66-91. 
VEBLEN,  THORSTEIN.     Vested   Interests  and  the   State  of  the  Industrial 

Arts.     N.  Y.,  B.  W.  Huebsch,  1919. 
WALLAS,  GRAHAM.     The  Great  Society.     N.  Y.,  Macmillan  Co.,  1919,  pp. 

235-269. 
t  WEBB,   SIDNEY.     Works   Manager   Today.     N.   Y.,  Longmans,   Green  & 

Co.,  1918. 


CHAPTER  IV 
FUNCTIONS  OF  THE  PERSONNEL  DEPARTMENT 

All  discussion  of  the  proper  functions  of  a  personnel  depart- 
ment should  distinguish  between  a  theoretically  sound  division 
of  duties  and  the  redistribution  of  executive  responsibility  which 
it  is  immediately  practical  and  expedient  to  make. 

There  is,  at  least  in  the  more  advanced  and  large  scale  corpora- 
tions, fairly  close  agreement  as  to  the  functions  which  should 
be  assigned  to  the  several  divisions  of  this  department.  And 
it  will  be  our  endeavor  to  outline  those  functions  in  this  chapter, 
leaving  to  subsequent  chapters  a  description  of  the  methods 
of  carrying  out  their  attendant  responsibilities. 

This  exposition  carries  with  it,  however,  no  suggestion  that 
every  corporation  should  necessarily  at  once  organize  or  reor- 
ganize its  executive  work  in  complete  conformity  to  this  scheme. 
It  is  rather  the  model  to  which  all  may  profitably  be  brought  to 
conform  as  rapidly  as  local  conditions  permit.  For  there  is 
little  to  be  gained  by  the  adoption  of  a  paper  plan  which  is  not 
actually  accepted  and  worked  on  by  the  entire  organization. 
The  allocation  of  responsibilities  to  personnel  executives  should 
therefore  take  place  only  when  the  personnel  department  is 
reasonably  sure  it  can  handle  a  function  at  least  as  well  as  it  has 
been  handled  under  some  other  jurisdiction;  and  when  the  other 
executives  who  have  a  direct  interest  in  the  successful  per- 
formance of  the  function  are  sufficiently  cordial  about  its  transfer 
to  be  willing  to  cooperate  with  the  personnel  department  to  the 
best  of  their  ability.  There  will,  of  course,  always  bo  doubters 
and  scoffers  whose  objections  should  not  be  given  too  serious 
weight;  but  it  is  nevertheless  tremendously  important  for  the 
personnel  department  to  develop  and  extend  its  authority  no 
faster  than  it  can  competently  do  the  work  it  undertakes. 

It  will  help  to  kcx  p  managerial  thinking  on  this  problem  sound, 
also,  if  at  every  point  the  distinction  is  kept  in  mind  between 
functions  and  people.  There  may  be  but  one  employment  exec- 
utive in  a  small  plant,  yot  he  may  have  responsibility  for  various 

n 


FUNCTIONS  OF  THE  PERSONNEL  DEPARTMENT         31 

functions.  Or  there  may  be  one  executive  whose  qualifications 
are  such  that  he  is,  for  example,  successfully  used  as  a  selector, 
as  editor  of  a  company  paper  and  as  job  instructor.  Such  a 
combination  of  duties  is  by  no  means  an  evidence  of  poor  execu- 
tive planning.  Indeed,  it  will  usually  be  good  policy  to  let  the 
qualifications  and  interests  of  the  staff  determine  the  actual 
distribution  of  their  duties,  rather  than  to  hold  to  an  arbitrary 
and  complete  departmentalizing  of  the  work  that  each  does. 
But  where  this  policy  is  pursued  it  is  useful  to  keep  currently 
accurate  two  charts :  One  showing  the  several  functions  which  it 
has  been  agreed  the  personnel  department  shall  assume;  the 
other  showing  the  duties  which  are  assigned  to  each  member  of 
the  personnel  staff. 

For  administrative  purposes  there  is,  however,  an  approxi- 
mately logical  division  of  work  into:  Employment,  Health  and 
Safety;  Education;  Research;  Service;  Adjustment  and  Joint 
Relations. 

Before  enumerating  the  detailed  responsibilities  under  each 
of  these  heads  it  is  well  to  indicate  the  general  basis  of  this  classi- 
fication; for  no  division  of  work  in  the  personnel  department 
can  completely  satisfy  every  demand  of  logic. 

In  general,  employment  covers  all  the  work  entailed  in 
securing  a  willing  and  effective  working  force. 

Health  and  safety  covers  all  the  work  of  personal  hygiene  and 
of  maintaining  the  plant  in  such  a  condition  that  the  health 
and  physical  integrity  of  the  workers  is  conserved  and  improved. 

Education  covers  all  the  training  activities  of  the  plant. 

Research  includes  those  activities  of  intensive  job  study  and 
of  perpetual  plant  analysis — labor  audit — which  are  essential 
for  securing  a  basis  of  fact  on  which  decisions  about  terms  and 
conditions  of  employment  can  be  based. 

Service  includes  all  the  miscellaneous  activities  such  as  rec- 
reation, cooperative  purchasing,  etc.,  which  are  less  directly 
related  to  the  production  problem  than  such  matters  as  selection 
and  training  for  the  job. 

Adjustment  and  joint  relations  cover  all  the  efforts — by  in- 
dividual conference,  shop  committees,  company  unions  and 
collective  bargaining  with  labor  unions — to  settle  upon  the  terms 
of  the  labor  contract  and  to  adjust  difficulties  which  have 
arisen  either  as  to  those  terms  or  their  fulfillment.  This  di- 
vision is  interested  in  permanently  maintaining  a  relationship 


32  PERSONNEL  ADMINISTRATION 

between  managers  and  men  which  is  characterized  by  under- 
standing, freedom  from  complaint  and  goodwill. 

Employment. — Under    the  designation  of   employment,   the 
following  duties  are  usually  assigned : 

1.  Knowledge  of: 

(a)  Labor  market  and  the  sources  of  supply 

(6)   Work  requirements — use  of  job  analysis  and  job  specifications 

(c)   All  wage  rates  paid 

(rf)  Hours  of  work  and  other  terms  of  employment 

2.  Selection  including: 

(a)  Preliminary  interview 
(6)  Interview 

(c)  Hiring 

(d)  Follow-up  of  references 

(e)  Physical  examination 

(/)    Other  special  tests,  including  intelligence  and  trade  tests 

3.  Introduction  to  plant  and  general  instructions  to  new  employees  on 

company  policies 

4.  Follow-up  of  new  employees  at  the  job 

5.  Recommendations  for  transfers  and  promotions 
d.  Interview  all  leaving  employees: 

(a)  To  insure  fair  consideration  of  their  case 
(6)  To  discover  reasons  for  leaving 
(c)  To  analyze  and  pass  upon  discharges 
7.  Compilation  and  care  of  records  of: 

(a)  Applicants 

(6)   New  employees 

(c)   Adequate  individual  progress  records 

Health  and  Safety. — Under  health  and  safety  the  following 
duties  are  usuall>  assigned: 

1.  Recommending  of  standards  of  physical  fitness  for  workers  at  different 

jobs 
'_'    Physical  examinations  of: 

(a)  Applicants 

(6)   Present  employees 

(c)  Re-examination  of  those  with  special  disabilities 

(d)  Special  oversight  of  workers  exposed  to  industrial  hazards 

3.  First  aid  work.     Hospitals 

4.  Treatment  of: 

(a)  Surgical  and  accident  cases 

(b)  Dental  case* 

(c)  Ocular  cases 
//)  Medical  can* 

6.  (Jiving  of  individual  medical  advice — home  service. 


FUNCTIONS  OF  THE  PERSONNEL  DEPARTMENT         33 

6.  Systematic  plant  inspection  by: 

(a)  Safety  engineer 

(b)  Members  of  general  and  departmental  safety  committees 

7.  Cooperation  with  proper  authorities  in  reporting  all  accidents 

8.  Control  and  reduction  of  accidents: 

(a)  Following  best  building  practice 
(6)  Safeguarding  hazards 

(c)  Safety  organization  and  education 

(d)  Follow-up  of  accidents 

9.  Compensation  payments 

10.  Systematic  check-up  of  all  working  conditions: 

(a)  Cleaning 

(6)  Ventilation,  and  humidity 

(c)  Lighting 

(d)  Heating 

(e)  Washing  and  bathing  facilities 
(/)  Toilet  equipment 

(g)   Dressing  rooms 

(h)  Lockers 

(i)    Drinking  water 

(J)   Janitor  and  matron  service 

(k)  General  supervision  of  sanitary  and  working  conditions 

11.  Prevention    and    elimination    of    communicable    diseases,    epidemics, 

industrial  disease  hazards,  and  special  strains  of  industry: 
(a)  Fatigue 
(6)   Mental  strain 

(c)  Motion  study 

(d)  Working  hours,  rest  periods 

(e)  Special  problems  connected  with  women's  work 

12.  Cooperation  in  study  and  investigation  of  absences 

13.  Adequate  records  and  statistics  on  all  health  matters: 

(a)  Physical  examinations 

(6)  Sickness 

(c)  Treatments 

(d)  Accidents 

(e)  Occupational  diseases 

Education. — Under  education  the  following  duties  are  usually 
assigned : 

1.  Training  courses  for  executives 

2.  Training  courses  for  foremen,  assistant  foremen  and  instructors 

3.  Training  new  workers  in  company  policies,  and  in  knowledge  of  the 

uses  of  the  company's  product 

4.  Apprentice  courses 

5.  Vestibule  schools 

6.  Part  time  continuation  schools 

7.  Job  instruction 

8.  Company  publications 

3 


34  PERSONNEL  ADMINISTRATION 

9.  Suggestion  systems 

10.  Bulletin  board  information 

11.  Circulation  of  magazines  and  library  books 

12.  Organization  of  educational  clubs 

13.  English  and  naturalization  instruction 

14.  Training  for: 

(a)  Transfers 
(6)  Promotions 
(c)    Inspection 

15.  Training  in: 

(a)  Personal  hygiene 
(6)  Safety 

16.  Cooperation  with  outside  educational  agencies 

Research. — Under  research  the  following  duties  are  usually 
assigned: 

1.  Job  analysis  and  preparation  of  job  specifications: 

(a)  Time  and  motion  studies 

2.  Fatigue  studies 

3.  Studies  and  recommendations  as  to  wage  rates 

4.  Studies  of  cost  of  living 

5.  Perpetual  labor  audit  of  the  factory 

6.  Study  of  current  experiments  of  other  concerns  in  various  personnel 

activities,  with  recommendations  as  to  their  adaptability  to  the 
plant  under  consideration . 

Service  features. — Under  service  features  the  following  duties 
are  usually  assigned: 

1.  Recreation  work: 

(a)  Noon-day  and  rest  period  programs 
(6)  Supervision  of  athletics 
(c)   Dramatics,  musical  clubs 

2.  Benefit  and  insurance  schemes 

3.  Cooperative  purchasing  arrangements 

4.  Rest  rooms 

5.  Summer  vacations 
0.  Employees'  gardens 

7.  Supervision  of  company  housing 

8.  Thrift  activities 

0.  Cooperation  in  the  maintenance  of  adequate  local  housing,  trans- 
portation, civic  activities  of  all  sorts,  public  health,  primary 
education,  etc. 

Adjustment  and  Joint  Relations. — Under  adjustment  and  joint 
relations  may  conveniently  be  grouped  the  following  duties, 
most  of  which  would  not  be  handled  by  the  personnel  depart- 


FUNCTIONS  OF  THE  PERSONNEL  DEPARTMENT         35 

ment  alone  but  in  conference  with  the  other  major  department 
or  departments  which  are  also  immediately  involved: 

1.  Handling  of  questions  of  shop  control,  e.g., 

(a)  Adoption  of  shop  rules 

(6)   Enforcement  of  shop  rules  , 

(e)   Handling  of  grievances  and  complaints 

2.  Adjusting  questions  of  discharge 

3.  Cooperating  in  the  supervision  of  shop  committees 

4.  Adjusting  the  terms  of  emoloyment 

(a)  Wages 
(6)  Hours 

5.  Conferring  with  shop  committees  or  labor  unions  with  which  joint 

relations  exist,  on  all  matters  of  common  interest 

There  are  other  activities  which  are  no  less  important  but  which 
it  is  less  easy  to  classify  under  specific  functions.  There  is,  for 
example,  the  important  work  of  familiarizing  the  other  executive 
departments  with  the  work  of  the  personnel  department,  and  of 
educating  those  departments  into  a  proper  appreciation  and  use 
of  a  wholesome  point  of  view  and  procedure  in  human  relations 
work.  We  shall  consider  this  function  in  a  chapter  on  "co- 
ordination of  policy." 

There  is  also  a  real  responsibility  upon  the  personnel  depart- 
ment to  keep  in  touch  with  the  related  local  and  national  organi- 
zations and  movements.  Problems  of  labor  legislation  and  labor 
law  enforcement  are  of  increasing  magnitude  in  industrial  re- 
lations work.  Facts  about  collective  bargaining,  shop  committee 
developments  and  the  growth  of  different  types  of  labor  unions 
should  be  kept  currently  accurate.  And  relations  to  employers' 
associations  and  employment  managers'  associations  should  be 
kept  up  in  order  that  the  experience  of  other  firms  may  be  con- 
stantly^drawn  upon. 

It  ma&ibe  said,  in  short,  that  it  isxthe  ideal  of  personnel  manage- 
ment to  administer  all  those  activities  not  directly  related  to 
supervision  of  the  worker  on  the  job,  where  Oentact  with  the 
workers  is  direct  and  essential.  It  is  the  department  of  personal 
contacts. 

-  And  it  is,  in  the  second  place,  the  branch  of  the  management 
which  has  the  responsibility  for  keeping  the  fact  that  workers  are 
human  beings  central  in  all  managerial  thinking.  It  is  the  de- 
partment of  management  which  specializes  in  intelligence,  in- 
sight, patience  and  sympathy;  and  is  therefore  primarily 
concerned  with  the  preservation  of  goodwill  and  working  morale. 


36 


PERSONNEL  ADMINISTRATION 


CHART  I. — Personnel  Department:  Interrelations  and  Functions. 


FUNCTIONS  OF  THE  PERSONNEL  DEPARTMENT 


37 


Division  of 

JOINT  COHTROL 

1.  6RIEVANCESaCOMPLAIHTS 

2.  QUESTIONS  OFSHOPCHttm. 
AdoptumafJhepRulei 
fnfmemntofShopRvIn 

3.  ADJUSTING  QUESTIONS 
OFDISCHARGf 

4.  COOPERATING  IN  THE 
SUPERVISION  OF  SHOP 
COMMITTEES 

S.COrlFERRlH&aA6R[EIHG 
MH  THE  PROPERLY  COH- 
'  STITUTED  EMPLOYEE  OR 
UNION  OROUPS  OHTEKMS 

OFEMPLOYMEHT: 

Wages 

Hours 

ID'       vfi      i— '     cd 


an     o" 


?Q 

,-S 

!«. 

^^i  ' 

DIVISION  OF 
RESEARCH 

JOB  A  HA  LYSIS 

PREPARATION  OFJO 
SPECIFICATIONS 

TIME  AND  MOTION 
STUDIES 

FATI&UE  STUDIES 

WAGE  RATE  5TUPIE. 
AHD  RECOMMEHDATffi 

STUDIES'  OF  COST  0 
LIVING 

PERPETUAL  LABOR  AW 
OF  THE  FACTORY 

ill^ 

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tJ 

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•* 

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38 


PERSONNEL  ADMINISTRATION 


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I 
& 


FUNCTIONS  OF  THE  PERSONNEL  DEPARTMENT         39 

Organization  Charts. — Chart  I  shows  the  major  functions  of 
the  personnel  department  and  its  vital  relation  to  the  individual 
worker.  It  illustrates  graphically  the  thesis  about  which  this 
book  is  written :  That  the  individual  is  the  central  value  and  end 
of  the  personnel  department's  activities. 

In  order  to  suggest  a  grouping  of  functions  which  conforms  to 
the  conventional  arrangement  of  organization  charts,  Chart  II  is 
included.  The  effort  in  this  diagram  is  only  to  restate  in  terms 
of  administrative  divisions  and  duties  what  the  first  chart  also 
presents. 

Chart  III  shows  the  lines  of  authority  and  responsibility  in 
the  personnel  department. 

A  further  chart  showing  the  relationship  of  the  personnel 
department  to  the  other  departments  will  be  considered  in  con- 
nection with  Chapter  XXVI. 

Selected  References 

CLOTHIER,  R.  C.  Employment  Work  of  the  Curtis  Publishing  Company. 
(In  Annals,  American  Academy,  v.  65,  pp.  94—111,  May,  1916.) 

CLOTHIER,  R.  C.  Function  of  the  Employment  Department.  (In  U.  S. 
Bureau  of  Labor  Statistics  Bid.  192,  1916,  pp.  7-14.)  Reprinted  in 
BLOOMPIELD,  DANIEL.  Selected  Articles  on  Employment  Manage- 
ment, 1919,  pp.  158-166. 

DENNISON,  H.  S.  What  the  Employment  Department  Should  be  in  In- 
dustry. (In  U.  S.  Bureau  of  Labor  Statistics  Bui.  227,  1917,  pp. 
77-81.) 

GARDNER,  H.  L.  Employment  Department;  Its  Functions  and  Scope. 
(In  U.  S.  Bureau  of  Labor  Statistics  Bui.  202,  1916,  pp.  49-55.) 

GOULD,  E.  C.  Modern  Industrial  Relations  Department.  (In  Iron  Age 
v.  102,  pp.  832-833,  Oct.  3,  1918.)  Reprinted  in  BLOOMFIELD,  DANIEL, 
Selected  Articles  on  Employment  Management,  1919,  pp.  193-196. 

HOPKINS,  E.  M.  Advantages  of  Centralized  Employment.  (In  Annals, 
American  Academy,  v.  71,  pp.  1-9,  May,  1917.) 

HOPKINS,  E.  M.  Functionalized  Employment  Department  as  a  Factor  in 
Industrial  Efficiency.  (In  Annals,  American  Academy,  v.  65,  pp.  67- 
75,  May,  1916.)  Reprinted  in  BLOOMFIELD,  DANIEL.  Selected 
Articles  on  Employment  Management,  1919,  pp.  149-158. 

HUBBELL,  N.  D.  Organization  and  Scope  of  the  Employment  Department. 
(In  U.  S.  Bureau  of  Labor  Statistics  Bui.  227,  1917,  pp.  97-113.) 
Reprinted  in  BLOOMFIELD,  DANIEL.  Selected  Articles  on  Employ- 
ment Management,  1919,  pp.  166-183. 

KENNEDY,  DUDLEY.  Functions  and  Scope  of  the  Employment  Department. 
(In  National  Association  of  Employment  Managers,  Proceedings  1st 
Annual  Convention,  1919,  pp.  12-19.) 


40  PERSONNEL  ADMINISTRATION 

I.KISKUSON.  W.  M.  Relations  Between  Employer  and  Employee.  (In 
U.  S.  Bureau  of  Labor  Statistics  Monthly  Labor  Review,  v.  9,  pp.  1195- 
1204,  Oct.,  1919.) 

NATIONAL  ASSOCIATION  OF  CORPORATION  SCHOOLS,  COMMITTEE  ON  VO- 
CATIONAL GUIDANCE.  What  a  Large  Corporation  has  done  to  Diag- 
nose its  Human  Relations.  (In  National  Association  of  Corporation 
Schools,  Addresses,  Reports,  etc.,  4th  Annual  Convention,  Pittsburgh, 
Pa.,  May  30-June  2,  1916,  pp.  295-301.) 

NICHOLS,  E.  F.  Employment  Manager.  (In  Annals,  American  Academy, 
v.  65,  pp.  1-8,  May,  1916.) 

Organization  and  Functions  of  the  Personnel  Department.  (In  Personnel, 
The  Employment  Managers  Bulletin,  v.  2,  no.  1,  p.  3,  Jan.,  1920.) 
Chart  only. 

PORTENAR,  A.  J.  Centralized  Labor  Responsibility  from  a  Labor  Union 
Standpoint.  (In  Annals,  American  Academy,  v.  71,  pp.  191-201,  May, 
1917.) 

REILLY,  P.  J.  Work  of  the  Employment  Department  of  the  Dennison 
Manufacturing  Company,  Framingham,  Mass.  (In  Annals,  American 
Academy,  v.  65,  pp.  87-94,  May,  1916.) 

SLICHTER,  S.  H.  Work  of  the  Employment  Department.  (In  his  Turn- 
over of  Factory  Labor,  1919,  pp.  281-282.) 

U.  S.  SHIPPING  BOARD,  EMERGENCY  FLEET  CORPORATION.  Organizing  the 
Employment  Department.  Philadelphia,  Pa,,  pub.  by  Corporation, 
1918.  (Handbook  on  Employment  Management  in  the  Shipyards. 
Bui.  no.  1.)  Reprinted  in  BLOOMFIELD,  DANIEL.  Selected  Articles 
on  Employment  Management,  1919,  pp.  183-193. 

WEBB,  SIDNEY.  Function  of  Management  (In  his  Works  Manager  Today, 
1918,  pp.  2-14.) 


CHAPTER  V 
SOURCES  OF  LABOR  SUPPLY 

Managers  who  are  fortunate  enough  to  be  building  new  plants 
today,  decide  upon  their  location  with  an  eye  to  the  availability 
of  the  kind  of  workers  which  their  industry  requires.  Managers 
whose  plants  are  located  where  they  are  without  careful  con- 
sideration of  the  sources  of  labor  supply  are  frequently  at  a 
disadvantage  which  only  deliberate  efforts  can  overcome.  And 
those  deliberate  efforts  at  cultivation  of  sources  of  labor  supply 
are  increasingly  being  recognized  as  legitimate  and  profitable. 

"Labor  scouting"  was  a  familiar  activity  before  the  war, 
which  became  deservedly  unpopular  with  progressive  managers 
during  the  war  because  it  meant  "stealing  workers"  in  ways  not 
altogether  honorable  nor  conducive  to  shop  and  individual  effi- 
ciency. Cultivation  of  sources  of  labor  supply  must  be  a  more 
considered,  scientific  and  justifiable  procedure  than  scouting. 
It  must  be  rather  an  attempt  on  the  part  of  managers  so  to  bring 
the  advantages  of  working  in  their  plants  before  qualified  groups 
of  workers,  that  they  will  want  to  apply  for  any  openings  which 
occur.  It  is  a  matter  of  organizing  the  community's  goodwill 
toward  the  plant — of  creating  an  attitude  toward  the  factory  in 
working  class  centers  which  makes  people  really  interested  to 
apply  for  a  job.  It  is  creating  a  legitimate  differential  between 
the  desirability  of  working  in  any  plant  and  the  superior  advan- 
tages of  working  in  a  particular  plant. 

In  a  campaign  to  cultivate  the  proper  sources  of  labor  supply 
for  a  plant,  it  should  be  possible  to  presuppose  two  things ;  that 
£  the  company  is  doing  all  it  can  to  keep  employees  with  it  con- 
tinuously so  that,  except  when  expansions  in  plant  occur,  the 
need  for  new  workers  will  be  minimized;  and,  secondly,  that  it 
knows  accurately  the  kind  and  quality  of  working  ability  which 
it  needs. 

On  the  first  point,  it  should  be  remembered  that  some  of  the 
best  corporations  spend  comparatively  little  on  cultivating  sources 
of  supply,  and  on  selection;  their  working  force  remains  sub- 

41 


42  PERSONNEL  ADMINISTRATION 

stantially  intact  year  after  year, — which  is  certainly  the  desirable 
objective  for  most  plants. 

On  the  second  point,  it  is  true  that  many  plants  in  the  absence 
of  careful  job  analysis  do  not  know  how  much  ability  and  what 
kind  of  ability  their  work  calls  for. 

But  assuming  that  the  company  does  know  its  labor  needs, 
it  can  undoubtedly  by  deliberate  efforts,  improve  the  quality  of 
the  applicants  from  among  whom  it  can  select.  These  efforts 
would  naturally  emanate  from  the  personnel  department;  and 
they  must  largely  take  the  form  of  personal  contacts.  Someone 
from  the  personnel  department  should  be  allowed  time  in  which 
to  come  to  know  the  community  agencies  and  leaders  who  are 
likely  to  be  in  touch  with  the  properly  qualified  workers. 

Local  teachers  and  school  superintendents,  priests  and  clergy- 
men, post-office  employees,  lodge  officials,  newspaper  reporters, 
even  car  conductors  and  store-keepers — all  these  in  medium 
sized  and  small  communities  are  in  touch  with  workers  of  one 
or  another  grade  of  skill. 

Especially  is  it  valuable  to  develop  personal  associations  in 
the  foreign  colonies;  with  leaders,  bankers,  priests  and  editors 
in  foreign  speaking  groups.  Confidences  which  are  genuinely 
established  with  such  groups  help  greatly  to  minimize  serious 
misunderstandings  which  might  otherwise  develop  with  groups 
of  foreign-torn  workers. 

The  same  is  true  of  relationships  with  local  trade  union  groups 
and  with  public  employment  offices.  The  value  of  personal 
acquaintanceship  as  the  basis  for  subsequent  dealings  is  tremen- 
dous; and  the  personnel  manager  is  wise  who  allows  and  encour- 
ages his  assistants  to  spend  some  time  in  mantaining  friendly 
associations  with  all  the  useful  community  organizations. 

Possible  Sources. — Enumeration  of  actual  sources  of  labor 
supply  would  l>e  a  prolonged  task,  since  the  sources  tend  to  vary 
with  the  size  of  the  community.  There  is,  moreover,  one  tech- 
nique of  cultivation  in  the  small  town,  another  in  the  small  city, 
still  another  in  the  large  city. 

One  thing  may,  however,  l>e  said  of  the  problem  in  every  local- 
ity. Success  depends  upon  the  reputation  which  the  company 
has  in  the  community,  for  fair  dealing,  for  adequate  terms  of 
employment  and  for  decent  working  conditions.  Without 
these,  workers  may  come  but  they  will  not  stay. 

It  is  also  generally  true  that  friends  of  present  employees  are 


SOURCES  OF  LABOR  SUPPLY  43 

a  quite  reliable  source  of  worth-while  new  workers.  Some  firms 
find  this  to  be  so  preeminently  true  that  thej/pay  employees  a 
bonus  of  from  $2  to  $5  for  new  workers  whom  they  bring  in  who 
stay  more  than  a  given  number  of  weeks.  J}  A  C\, 

Many  firms  in  both  large  and  small  communiues  encourage 
written  applications  from  people  who  are  elsewheie  employed 
but  would  like  to  change.  They  find  that  people  who  will 
write  in  this  way  are  usually  steady,  ambitious  workers  who, 
when  they  change  at  all,  stay  for  a  considerable  time. 

Casual  newspaper  advertising  is  used  successfully  by  some 
firms;  but  it  is  usually  regarded  as  a  last  resort. 

The  graduates  of  grammar  and  high  schools  are  systematically 
canvassed  by  some  employment  managers  both  for  factory  and 
office  positions.  Well  equipped  applicants  are  also  frequently 
found  in  business  colleges  and  trade  schools.  In  Minneapolis  these 
schools  keep  in  close  touch  with  the  employment  opportunities 
in  twenty-four  different  trades.  Many  of  these  educational 
institutions  give  technical  courses  in  addition  to  regular  courses. 
They  are  shaping  instruction  increasingly  in  terms  of  business 
and  social  values  so  that  pupils  may  be  prepared  for  rapid  ad- 
vancement in  industry.  Boston,  Philadelphia,  and  other  cities 
practise  even  more  active  cooperation  between  education  and 
industry  for  improving  sources  of  labor  supply.  Pupils  are 
given  positions  in  stores  on  Saturdays  or  during  vacation  periods 
and  encouraged  to  fit  themselves  for  a  useful  industrial  life. 

In  the  smaller  communities  house  to  house  canvassing  has  even 
been  resorted  to  by  companies  which  were  short  of  people.  If 
tactfully  done,  such  calling  may  help  to  establish  the  factory 
favorably  in  the  minds  of  local  people  and  encourage  them  to 
apply.  Often  workers  who  go  some  distance  to  their  work  are  glad 
of  a  chance  to  change  to  a  factory  which  is  within  walking  distance. 
Indeed,  some  firms  are  sajdng  today  that  they  prefer  not  to  hire 
people  who  live  more  than  a  mile  and  a  half  from  the  plant. 

Where  there  are  collective  bargains  or  strong  unions,  the  union 
headquarters  is  usually  a  source  for  craft  workers.  Some  em- 
ployers have  felt  compunctions  about  patronizing  the  union 
offices;  have  felt  that  they  thereby  in  some  way  admitted  a 
condition  of  union  ascendency.  This  is,  of  course,  a  shortsighted 
attitude  since  if  managers  would  go  half  way  to  deal  with  the 
unions  in  this  matter,  they  could  save  much  time  and  expense 
in  locating  competent  workers.  If  only  a  personal  connection 


44  PERSONNEL  ADMINISTRATION 

is  made  by  the  employment  department  with  the  union  office,  the 
union  will  usually  help  to  secure  workers  to  the  best  of  its  ability, 
especially  in  plants  with  which  it  has  collective  agreements. 
Indeed,  in  trades  which  have  reached  any  large  degree  of  organi- 
zation the  presumption  is  usually  that  the  more  energetic  and 
able  members  of  the  craft  are  in  the  union  and  available  through 
the  union  offices. 

Ideally,  however,  under  conditions  of  collective  bargaining, 
we  believe  there  is  much  to  be  said  for  having  employment  offices 
run  jointly  by  the  employers'  association  and  the  union.  This 
tends  to  put  them  on  a  business  footing,  to  assure  prompt  service 
which  is  satisfactory  to  both  groups.  And  it  has  the  further 
important  value  of  pooling  the  local  labor  reserves  of  the  trade. 

Such  a  pooling  process  should  ultimately,  of  course,  extend 
beyond  the  boundaries  of  an  industry.  There  should  be  some 
central  agency  or  group  of  agencies  through  which  information 
about  jobs  could  be  cleared  not  only  for  workers  going  from  one 
plant  to  another  but  for  those  going  from  one  industry  to  another 
and  from  one  locality  to  another. 

Public  Employment  Offices. — In  other  words,  from  the  point 
of  view  of  a  scientific  organization  of  the  labor  market,  there  is  an 
important  place  for  an  efficiently  run  clearing  house  for  all 
employment  information.  Such  a  clearing  house  should,  if 
properly  administered,  be  a  useful  source  of  labor  supply  to  the 
majority  of  plants.  But  for  the  clearing  house  to  be  valuable, 
it  should  be  country-wide  in  extent,  non-competitive,  free,  and  in 
powession  of  some  technique  for  trade  testing  or  individual 
rating. 

This  is  only  another  way  of  saying  that  such  an  employment 
service  should  be  a  public  function.  During  the  war  a  public 
employment  service  was  created  which  despite  inevitable  limita- 
tions due  to  its  emergency  character,  demonstrated  what  might 
be  done  to  supply  employers  with  information  alxnit  available 
workers,  and  workers  with  information  about  available  positions. 

It  is  no  part  of  our  task  to  meet  the  obvious  criticism  which 
can  be  brought  against  the  efficiency  of  that  service  in  certain 
localities.  The  practical  difficulties  which  employers  encoun- 
tered may  have  been,  and  in  some  cases  undoubtedly  were,  ex- 
tremely annoying.  But  those  difficulties  certainly  do  not  offer 
a  basis  for  refusing  to  recognize  the  essentially  sound  arguments 
for  the  continuance  and  improvement  of  the  service. 


SOURCES  OF  LABOR  SUPPLY  45 

Managers  must  recognize  in  a  fresh  way  how  necessary  con- 
tinuity of  employment  is  to  the  average  worker.  They  must 
recognize  that  the  time  between  jobs  will  be  greatly  reduced, 
that  the  morale  of  workers  will  be  improved,  and  that  the  under- 
lying working  class  fear  of  unemployment  can  be  minimized 
only  if  there  exists  an  efficient  and  universally  operating  agency 
of  information  through  which  ah1  openings  are  registered  and 
practically  all  applicants  cleared. 

Our  plea  is  for  the  endorsement  by  employers  of  a  public 
employment  system,  for  a  concerted  effort  by  managers  to  get 
it  reorganized,  for  a  patient  attempt  to  use  it  and  cooperate  with 
it,  even  if  results  do  not  seem  at  first  to  warrant  the  attempt. 
This  country  will  never  reduce  casual  employment  and  under- 
employment as  it  should  be  reduced  until  we  consolidate  on  a 
national  scale  all  our  labor  reserves.  Only  so  can  we  rid  ourselves 
of  that  astounding  anomaly  of  the  present  labor  market :  That 
"a  rising  demand  for  labor  is  no  cure  for  unemployment."1 
By  which  is  meant  that  a  permanent  cause  of  considerable  idle- 
ness is  the  delay  experienced  by  idle  workers  in  trying  to  locate 
new  positions  by  the  tedious,  wasteful  and  discouraging  process  of 
"peddling  their  wares"  from  one  factory  to  another. 

Once  managers  become  really  alive  to  the  damaging  results 
of  unemployment  upon  working  class  morale,  they  will  be  ready 
to  help  in  building  a  system  of  public  employment  offices  which 
will  be  in  fact  what  they  should  be  in  theory, — the  principal 
source  of  factory  and  mercantile  labor  supply.  There  are,  of 
course,  various  ways  of  achieving  this  end  of  a  consolidated 
labor  market  and  source  of  labor  supply.  It  may  be  done  by  the 
presence  of  corporation  employment  workers  in  the  public  offices. 
There  may  in  the  organized  industries  be  cooperative  employ- 
ment offices  through  which  the  bulk  of  the  shifting  within  the 
industry  takes  place,  leaving  only  the  shifting  between  that 
industry  and  others  to  the  public  offices.  There  may  be  agree- 
ment between  the  employment  manager  of  a  concern  and  the 
public  office  that  only  applicants  who  come  through  the  public 
office  will  be  interviewed.  This  method  was  used  with  some 
success  by  one  or  two  plants  in  a  New  England  city  where  the 
public  office  proved  competent  to  act  as  a  central  clearing  house. 

1  See  the  brilliant  analysis  and  exposition  of  this  thesis  in  the  fundamental 
study  of  the  labor  market  by  WM.  H.  BEVERIDGE,  Unemployment — A 
Problem  of  Industry. 


46  PERSONNEL  ADMINISTRATION 

But  as  long  as  the  proper  end  is  held  in  view,  sensible  methods 
will  be  devised.  The  aim  must  be  to  have  the  sources  of  supply 
become  as  unified  as  possible.  It  will  save  employers  and 
workers  alike  hours  and  hours  of  valuable  time  as  soon  as  agree- 
ment can  be  widely  reached  that  in  one  agency,  and  in  one  agency 
only,  can  all  get  what  they  want ;  that  in  one  centrally  organized 
system  of  offices  all  jobs  are  known  and  all  unemployed  workers 
are  registered. 

Further  Sources  of  Labor  Supply. — The  newly  discharged  occu- 
pants of  state,  county,  and  municipal  penal  institutions  are  a 
hitherto  neglected  source  of  supply.  Approximately  half  a  million 
inmates  are  discharged  annually  into  the  various  communities 
of  the  country.  And  the  plight  in  which  they  are  likely  to  find 
themselves  is  truly  pitiable  and  a  reflection  upon  the  social 
conscience — not  to  mention  business  sense — of  the  community. 
For  in  many  cases  these  men  have  a  narrow  margin  of  funds  and 
few  if  any  friends  of  such  a  standing  that  they  can  be  effectually 
used  as  references  in  getting  jobs.  And  they  meet  on  all  sides  a 
prejudice  against  "ex-convicts"  which  all  but  forces  them  to 
remain  outlawed  and  unproductive. 

In  this  situation  industrial  managers  have  a  responsibility 
for  helping  to  reintegrate  these  unfortunates  which  they  can  no 
longer  ignore.  The  Ford  Motor  Company  of  Detroit  has  set  a 
notable  example  in  this  work  of  reintegration.  It  reserves/one 
per  cent,  of  its  positions  for  men  with  prison  recordsj helping 
them  to  develop  into  good  citizens  by  offering  them  1i  second 
chance  in  lite.  Such  employees  need  protection  against  denuncia- 
tion, as  well  as  careful  and  sympathetic  oversight.  There  is 
every  reason  why  industry  should  draw  on  this  source,  especially 
since  by  cooperation  with  penal  institutions  many  employers 
have  already  demonstrated  in  a  quiet  way  that  former  prisoners 
are  not  only  "safe"  to  employ,  but  are  usually  eager  for  the 
chance  to  make  good  and  establish  a  good  name  for  themselves. 
And,  of  course,  the  economic  and  moral  gain  to  society  of  reviving 
hope  and  courage  in  these  men  by  helping  them  realize  useful 
and  satisfying  lives,  cannot  be  measured  in  money  terms. 

Limits  upon  Sources. — Complication  is  introduced  into  the 
procedure  of  cultivating  sources  when  definite  limits  are  put  upon 
the  selective  process.  Some  companies,  for  example,  have 
recently  decided  to  employ  only  American  citizens.  And  while 
it  is  easy  to  understand  and  sympathize  with  this  position,  it 


SOURCES  OF  LABOR  SUPPLY  47 

seems  doubtful  whether  such  a  policy  can  be  recommended  for 
wide  adoption.  Until  our  country  makes  far  greater  provision 
for  free  instruction  in  English  and  naturalization  than  is  now  the 
case,  it  is  an  arbitrary  and  in  a  sense  unfair  restriction  from  the 
workers'  point  of  view  to  exclude  them  from  employment  on  this 
ground. 

The  restriction  that  only  applicants  who  live  within  a  certain 
radius  of  the  plant  will  be  accepted,  is  based  on  a  desire  to  cut 
down  the  time  of  coming  and  going  from  work,  to  create  a  homo- 
geneous group  of  workers,  to  make  community  ties  and  industrial 
ties  more  nearly  identical  than  is  usually  the  case.  This  also  is  a 
policy  that  is  of  doubtful  value  for  general  application ;  although 
there  may  occasionally  be  conditions,  especially  where  there  are 
women  workers,  where  such  a  policy  is  to  be  preferred. 

The  policy  of  excluding  workers  of  some  one  race,  religious 
affiliation  or  color  is  one  concerning  the  adoption  of  which  the 
peculiar  local  circumstances  and  prejudices  manifestly  have 
determining  weight.  It  is  impossible  to  generalize  as  to  wise 
procedure.  But  it  is  not  only  important  but  essential  where 
such  exclusions  are  felt  to  be  justified,  to  handle  the  procedure  so 
that  the  basis  of  exclusion  shall  so  far  as  possible  be  candidly 
acknowledged.  Frankness  in  matters  of  this  sort,  provided 
always  it  is  accompanied  by  kind  and  courteous  treatment,  is  to 
be  preferred  to  any  hypocritical  pretexts.  And  it  is  well  to 
remember  in  this  connection  that  not  what  is  said  but  the  way  in 
which  it  is  said,  is  what  counts  most. 

Sources  of  Supply  for  Executive  Workers. — Some  manufac- 
turing companies  build  up  their  executive  staff  almost  entirely 
by  "scouting."  Their  employment  chiefs  periodically  visit 
universities,  graduate  schools  of  business  administration,  and 
technical  institutions.  These  representatives  describe  in  a  per- 
sonal talk  to  graduating  classes  business  opportunities  open  in 
their  industry,  and  invite  application  for  positions.  Since  many 
educational  institutions  have  added  to  their  curriculum  courses  on 
the  human  relations  in  industry,  alumni  groups  from  these  courses 
will  be  a  valuable  source  for  new  workers  in  the  personnel  field. 

In  order  to  justify  these  university  visits  their  effect  should  be 
twofold.  Educational  institutions  should  more  vividly  realize 
the  demand  of  industry  for  trained  material  from  which  to  select 
its  future  leaders,  and  be  willing  to  adopt  a  broader  outlook  in 
their  educational  policy.  And  students  should  gain  practical 


48  PERSONNEL  ADMINISTRATION 

guidance  which  helps  them  to  get  light  on  their  half-formed  opin- 
ions about  a  life  work. 

In  calling  attention  to  sources  of  supply  for  executive  positions, 
it  would  be  unfortunate,  however,  to  slight  the  factory  itself. 
Organizations  which  hold  to  a  policy  of  "promoting  from  within" 
have  in  their  own  ranks  people  who  know  the  business  and  its 
traditions,  and  who  would  be  greatly  stimulated  by  the  assurance 
of  promotional  opportunities. 

Conclusion. — Some  experts  feel  that  the  necessity  for  culti- 
vating sources  of  labor  supply  is  in  inverse  proportion  to  the 
success  of  the  company's  personnel  relations  work.  And  there 
is  something  to  be  said  for  this  view.  But  a  certain  amount  of 
turnover  is  inevitable  and  it  is  good  business  to  try  to  have  those 
who  apply  of  a  progressively  superior  character.  To  secure  this 
result,  a  degree  of  deliberate  planning  is  usually  necessary,  no 
matter  how  popular  the  plant  may  be. 

And  the  essence  of  this  campaign  of  cultivation  is  that  it  shall 
be  carried  on  by  honest  and  genial  assistants  who  know  that  the 
management  is  more  than  prepared  to  "deliver  the  goods," 
prepared  to  realize  the  hopes  of  opportunity  and  enjoyment  which 
they  have  raised  in  the  minds  of  prospective  workers. 

Selected    References 

AMERICAN   ASSOCIATION   OF   PUBLIC   EMPLOYMENT  OFFICES.     Proceedings 

of  the  Fourth  Annual  Meeting,  Buffalo,  N.  Y.,  July  20  and  21,  1916. 

Washington  Government  Print  Off.,  1917.      (U.  S.  Bureau  of  Labor 

Statistics  Bid.  220). 
BEVERIDGE,    W.    H.     Unemployment:    a    Problem    of  Industry,   3rd  ed. 

N.  Y.,  Longmans,  Green  &  Co.,  1917. 
HUBBELL,  N.  D.     How  to  Get  Help.     (In  Industrial  Management,  v.  55, 

pp.  68-9,  Jan.,  1918). 
KM u.  J.  S.     Establishment  of  Permanent  Contacts  with  the  Sources  of 

Labor  Supply.     (In  Annals,   Am.   Acad.,   v.   65,  pp.    160-169,    May, 

1916). 

LITCH FIELD,  I.  W.     United  States  Employment  Service  and  Demobiliza- 
tion.    (In  Annals,  Am.  Acad.,  v.  81,  pp.  19-27,  Jan.,  1919). 
LESCOHIER,  D.  D.     The  Labor  Market.     N.  Y.,  Macmillan  Co.,  1919. 
MDHLHAUSER,  HILDA.     Public  Employment  Bureaus  and  Their  Relation  to 

Managers  of  Employment  in  Industry.     (In  Annals,  Am.  Acad.,  v. 

65,  pp.  170-5,  May,  1916.     Also  in  U.  S.  Bureau  of  Labor  Statistics 

BuL  198,  pp.  25-29,  1916). 
TEAD,  ORDWAY.     United  States  Employment  Service  and  the  Prevention  <>f 

Unemployment.     (In  Am.  Labor  Legislation  Review,  v.  9,  pp.  93-100, 

March,  1919). 


. 


CHAPTER  VI 
METHODS  OF  SELECTION  AND  PLACEMENT 

(Scientific  and  humanly  sympathetic)  procedure  in  the  selec- 
tion of  workers  is  a  basic  need  in  personnel  relations.  Much  of 
the  costly  turnover  and  friction  of  modern  industry  is  directly 
due  to  a  haphazard  choice  of  workers;  and  if  those  responsible 
for  determining  labor  policies  would  but  realize  the  importance 
of  even  a  minimum  of  specific  selection  standards  much  waste 
could  be  eliminated. 

The  process  of  selection  is  one  in  which  management  and 
worker  are  really  after  the  same  result.  The  chance  that  each 
worker  will  really  achieve  a  necessary  degree  of  self  develop- 
ment, depends  in  large  measure  upon  the  judgment  with  which 
he  choses  his  job.  His  special  interest  is  not  alone  to  find  an 
opportunity  for  an  adequate  livelihood;  he  wants  to  get  that 
livelihood  out  of  labors  which  are  reasonably  interesting  to  him, 
have  some  significance  and  afford  some  satisfaction  in  the  doing. 
The  management's  special  interest  is  not  alone  to  get  enough 
"hands;"  it  wants  to  secure  the  cooperation  of  the  requisite 
number  of  human  wills — to  secure  a  cooperation  which  will  be 
continuous  and  intelligent.  The  time  has  come  when  no  organ- 
ization can  afford  not  to  take  time  enough  with  the  induction  of 
each  new  worker  to  assure  that  there  is  a  reasonably  successful 
adjustment  of  capacity  to  opportunity. 

But  to  effect  this  adjustment  is  no  easy  matter;  and  the  con- 
clusion which  can  safely  be  drawn  from  the  experiments  of  the 
last  dozen  years  is  that  successful  selection  presupposes  a  new 
and  separate  staff  department — a  personnel  department — to 
administer  it.  Indeed,  the  first  step  in  standardizing  selection 
procedure  is  to  set  up  an  employment  office  in  charge  of  an  ex- 
ecutive specially  trained  and  experienced  in  this  work. 

The  Interviewer. — Given  this  responsible  employment  de- 
partment, what  are  the  minimum  conditions  below  which  stand- 
ards in  the  selection  procedure  should  not  be  allowed  to  fall? 

Mention  should  first  be  made  of  the  preliminary  interviewer, 
4  49 


50  PERSONNEL  ADMINISTRATION 

In  many  large  plants  it  is  necessary  and  desirable  to  have  appli- 
cants passed  upon  in  a  general  way  by  a  first  interviewer  who 
is  thoroughly  familiar  with  the  company's  employment  standards 
and  who  weeds  out  the  obviously  unsuitable  candidates.  This 
work  calls  for  special  consideration  and  courtesy;  and  some  firms 
say  definitely  that  they  put  their  best  qualified  selectors  at  this 
initial  point.  The  first  company  representative  with  whom  the 
candidate  for  a  job  comes  into  contact — be  he  gateman,  police- 
man or  interviewer — cannot  be  too  carefully  chosen.  Where 
there  are  several  departments  for  which  selection  is  being  made 
and  in  which  widely  different  types  of  skill  are  required,  the 
value  of  this  preliminary  allocation  of  applicants  to  special 
interviewers  is  especially  great. 

Both  the  preliminary  and  the  final  interviewers  should  be  per- 
sons of  maturity.  The  work  of  selection  calls  for  too  much 
sympathy,  insight,  patience,  and  fineness  of  feeling  to  make  it 
safe  in  the  hands  of  the  usual  callow  young  clerk.  Those  who 
come  into  personal  contact  with  applicants  must  always  have  a 
lively  sense  of  the  importance  of  the  hiring  process  not  only 
to  the  management  but  to  the  worker.  Both  interviewers  may 
well  be  people  who  have  worked  in  the  plant.  And  knowledge 
of  some  of  the  European  languages  is  in  some  cases  indispensable. 

Yet  most  important  of  all  is  a  native,  spontaneous  interest 
in  people — a  sensitive  regard  for  the  nuances  of  personality; 
and  a  downright  warm-heartedness  with  which  is  coupled  a 
level  head.  The  conditions  under  which  a  man  is  to  be  preferred 
to  a  woman  as  selector  are  as  yet  hardly  defined;  except  that  it  is 
generally  agreed  that  women  workers  should  be  hired  by  women 
interviewers.  And  some  firms  have  found  it  true  that  women 
are  also  peculiarly  successful  in  hiring  men. 

Use  of  Job  Specifications. — Before  an  interviewer  can  work 
intelligently  he  should  have  in  his  possession  detailed  information 
as  to  the  kinds  of  work  the  plant  offers  and  the  qualifications 
required  in  employees.  This  information  should  be  available 
in  writing  as  job  specifications,  but  it  should  be  supplemented  by 
the  interviewer's  actual  knowledge  of  the  operation  gained  either 
by  his  having  done  it  or  by  his  having  seen  it  done. 

Job  specifications  are  based  on  a  full  analysis  of  each  job,  and 
methods  of  compiling  this  data  are  discussed  fully  in  connection 
with  that  topic.1  It  is  sufficient  here  to  suggest  that  specifica- 

*  Sec  Chapter  XVIII. 


METHODS  OF  SELECTION  AND  PLACEMENT  51 

tions  have  two  broad  functions — to  describe  and  define  process,, 
and  to  describe  and  define  the  personal  qualifications  needed 
for  carrying  on  the  process. 

In  connection  with  the  former,  it  is  necessary  for  the  inter- 
viewer to  know  and  discuss  fully  with  the  applicant  the  length 
of  time  required  to  learn  the  job,  its  educational  requirements 
and  advantages,  its  seasonal  features  and  probable  duration, 
the  rates  of  pay  and  the  average  output  for  piece,  day  and  week 
work,  and  the  possible  occupational  disease,  fatigue,  and  over- 
strain involved. 

Again,  it  is  important  to  understand  the  mental  and  temper- 
amental qualifications.  Ability  to  learn, — to  adjust  oneself 
to  the  conditions  imposed  by  a  given  job,  and  to  master  its 
difficulties, — is  generally  considered  the  most  necessary  quali- 
fication, while  general  intelligence  and  information  come  next. 

Character  values  are  more  difficult  to  appraise  than  are  any 
of  the  other  qualities,  yet  they  are  highly  significant.  "In 
the  vast  majority  of  cases,"  says  Link,  "the  moral  traits  that  an 
individual  displays  are  determined  by  two  variable  conditions. 
These  conditions  are  first,  a  liking  for  a  certain  kind  of  work 
for  its  own  sake,  and  secondly,  a  liking  for  the  work  for  the  sake 
of  the  rewards  which  it  makes  possible."1  Whether  one  agrees 
with  Link  or  not,  one  is  forced  to  admit  that  today  practically 
the  only  character  estimates  that  are  of  value  are  made  after 
a  period  of  actual  work  on  the  job  by  those  in  close  personal 
contact  with  the  worker. 

Job  specifications  can  never  be  a  substitute  in  the  employment 
office  for  the  interviewer's  concrete  knowledge  about  the  jobs 
for  which  he  hires.  But  as  an  organized  body  of  data  they  have 
considerable  value,  especially  in  the  view  they  may  help  to  give 
the  applicant  of  the  job's  possibilities. 

Requisitions  for  Help. — It  is  essential  to  any  standardization 
of  employment  procedure,  that  the  selectors  have  some  time  in 
which  to  carry  on  their  work.  This  must  mean  practically, 
that  they  are  informed  at  least  24  hours  and  preferably  48  hours 
in  advance,  of  a  department's  needs.  Where  skilled  people  are 
in  demand,  or  where  an  increase  in  staff  is  taking  place,  an  even 
longer  time  is  necessary.  Delinquent  foremen  are  usually 
brought  to  terms  on  this  matter  by  the  establishment  of  a  rule 
that  requisitions  calling  for  help  in  advance  will  be  honored 

1  LINK,  H.  C.     Employment  Psychology,  p.  205. 


52  PERSONNEL  ADMINISTRATION 

prior  to  those  calling  for  assistance  at  once.  There  will,  of 
course,  always  be  emergency  calls;  but  the  effort  should  be  to 
get  foremen  to  give  longer  and  longer  notice  ahead  of  positions 
to  be  filled. 

The  Waiting  Room. — Companies  which  wish  to  secure  the 
goodwill  of  prospective  employees  will  see  to  it  that  the  atmos- 
phere in  which  they  are  hired  is  cheerful  and  as  unrestrained 
as  possible.  First  impressions  are  too  important  for  any  op- 
portunity to  be  lost  to  start  the  worker  right.  The  waiting  room 
should  for  this  reason  not  be  hidden  off  in  some  out  of  the  way 
corner  of  the  plant.  It  should  be  in  a  place  accessible  to  the  street ; 
it  should  have  air  and  sunshine;  there  should  be  a  place  for  ap- 
plicants to  sit  down  while  waiting.  Usually  separate  waiting 
rooms  for  men  and  women  are  desirable;  and  often  separate 
rooms  also  for  skilled  and  unskilled  workers. 

Adjoining  the  waiting  room  should  be  the  interviewing  booths, 
so  arranged  that  each  applicant  can  come  into  completely  private 
conference  with  the  interviewer.  The  equipment  of  these  booths 
should  be  simple — a  chair  for  the  interviewer,  one  for  the  ap- 
plicant, and  a  small  table  for  pencil  and  paper  located  at  one  side. 

It  is  definitely  a  part  of  the  new  standard  practice  in  selection 
that  the  interview  be  carried  on  in  private.  By  this  one  provi- 
sion alone,  many  plants  would  greatly  improve  their  hiring 
methods  and  results. 

The  Interview. — In  the  interview  the  applicant  should  be  met 
as  far  as  possible  as  an  equal.  He  should  be  put  at  ease  and  not 
be  hurried;  he  should  be  provided  with  an  interpreter  whenever 
necessary.  Questions  which  are  too  direct  or  too  bluntly  put 
are  to  be  avoided  at  the  outset.  A  fair  chance  for  each  applicant 
to  present  his  own  case  is  essential.  The  aim  should  be  to  have 
the  process  of  selection  one  of  self-analysis,  self-direction,  self- 
placement  or  self-elimination. 

There  is  suggestive  value  for  a  point  of  view  in  interviewing  in 
Mr.  Link's  prophecy  that,  "it  will  undoubtedly  be  commonly 
recognized  in  time  that  the  entire  aim  of  employment  psychology 
is  to  attain  the  viewpoint  of  the  applicant,  and  to  further  his 
interests  by  selecting  him  for  the  work  which  he  is  best  able  to 
do  and  at  which  he  will  be  of  greatest  value  to  society  and  to 
himself."1 

The  examiner  who  gets  this  idea  of  the  purpose  of  his  work  will 

•flee  LINK,  H.  C.     Employment  Psychology,  p.  375. 


METHODS  OF  SELECTION  AND  PLACEMENT  53 

inevitably  be  courteous  and  patient;  he  will  inevitably  have 
proper  regard  for  the  natural  reserves  of  applicants  and  will  do 
nothing  to  impair  their  sense  of  self-respect  and  self-esteem. 

The  requirements  of  the  job  and  the  standards  of  employment 
in  terms  of  age,  sex,  strength,  special  abilities,  etc.,  should  be 
so  set  forth  that  the  worker  can  draw  his  own  inevitable  con- 
clusion as  to  his  fitness  for  the  position.  Indeed,  the  applicant 
for  whom  there  is  no  opening  should  be  so  treated  that  he  himself 
is  conscious  of  his  own  inability  to  qualify,  and  in  removing  him- 
self can  testify  that  the  company  is  one  in  which  employees  are 
properly  selected  and  given  every  opportunity.  One  corporation 
known  to  us  makes  it  a  rule  to  treat  rejected  applicants  with  such 
consideration  that  their  goodwill  toward  the  company  is  not  only 
retained  but  increased. 

In  making  a  fair  bargain  with  an  applicant,  perhaps  the  most 
necessary  measure  is  to  give  him  an  honest  evaluation  of  the  job. 
Overselling  the  job,  misstating  its  opportunities  for  advance- 
ment and  pay,  create  only  dissatisfaction.  The  physical  en- 
vironment, the  occupational  hazards,  the  hours  and  the  causes 
of  discharge  should  be  truthfully  pictured.  Many  times  the 
overselling  of  a  job  could  be  checked  if  the  applicant  were  shown 
the  job  specification  sheet  himself,  and  allowed  to  ask  questions 
of  the  interviewer.  Even  better,  of  course,  is  a  chance  for  the 
applicant  to  see  the  work  itself,  so  that  he  may  form  his  own 
estimate  of  it.  This  is  a  practice  which  appears  to  be  gaming 
in  favor  and  use. 

Interviewing  Blanks. — If  the  interviewer  is  favorably  impressed 
and  wishes  to  place  the  applicant,  he  will  use  an  information 
blank  on  which  to  write  the  data  that  he  has  gathered.  This 
either  takes  the  form  of  an  "  application  blank  "or  an  "interviewer's 
blank,"  or  in  some  cases  both.  The  former  is  spaced  to  receive 
the  name,  address,  age,  nationality,  education,  former  experience, 
etc.,  while  the  latter  is  arranged  to  contain  the  interviewer's 
estimate  of  the  applicant,  and  the  results  of  the  physical,  mental, 
skill  and  trade  tests. 

It  is  at  the  point  in  the  interview  after  the  usual  information 
about  the  applicant's  history  has  been  secured,  that  any  special 
tests  are  introduced.  We  shall  therefore  devote  the  next  few 
sections  to  a  brief  mention  of  the  most  scientific  of  these. 

Special  Tests. — The  use  of  various  psychological  and  trade 
tests  by  the  army  during  the  war  brought  a  great  improvement 


54  PERSONNEL  ADMINISTRATION 

in  their  technique  and  provided  solid  evidence  that  they  were 
worth  developing  and  applying  in  new  fields.  Especially  were 
the  general  intelligence  tests  and  the  trade  tests  utilized  on  a  scale 
which  brought  significant  evidence  of  their  possible  value  to  indus- 
try. Application  of  both  types  of  test  to  factory  work  has  been  slow 
in  coming,  however,  because  the  adaptation  is  admittedly  experi- 
mental and  requires  at  least  in  its  initial  stages  a  high  degree  of 
expert  skill  and  experience.  Even  before  the  war  there  had  been 
efforts,  it  is  true,  to  apply  intelligence  tests  to  certain  types  of 
work — more  especially  office  work;  and  these  efforts  were  fairly 
successful.  But  their  use  in  this  way  was  confined  to  a  few  large 
corporations  which  were  willing  to  venture  into  an  admittedly 
experimental  field. 

It  is,  therefore,  too  early  to  say  with  precision  what  the  place 
of  special  tests  in  industry  will  be  or  should  be  in  the  immediate; 
future.  But  we  do  know  that  it  is  the  first  duty  of  managers 
who  are  inclined  to  consider  innovations  in  the  direction  of 
scientific  methods  of  selection  to  understand  their  nature  and limi- 
tations. And  there  are  a  number  of  conclusions  about  such 
methods  which  apply  generally,  and  hence  may  be  first  con- 
sidered. 

The  tests  should,  of  course,  be  devised  by  experts  and  revised 
only  by  experts.  The  form  and  content  of  the  test  is  determined 
by  scientific  and  statistical  considerations  which  the  layman  can- 
not pretend  to  know.  The  checking  of  the  tests  against  the 
facts  of  people's  working  ability  on  the  job  is  a  problem  of  corre- 
lation which  at  the  outset  only  the  expert  who  installs  the  tests 
should  handle.  But  the  expert  should  not  only  install  and  check 
up  the  test  at  its  inception;  he  should  check  results  periodically 
to  be  sure  that  all  the  questions  are  of  value  in  disclosing  the 
qualities  to  which  an  index  is  being  sought. 

Another  problem  is  to  decide  upon  the  qualities  which  it  is 
desired  to  test  at  a  particular  kind  of  work  and  to  be  sure  always 
that  the  test  is  actually  succeeding  in  detecting  them. 

Great  care  is  necessary,  also,  in  the  use  of  th/ results  of  tests. 
They  are,  at  least  at  the  present  stage  of  their  development,  not 
positive  proofs;  they  arc  contributing  evidence  to  be  weighed 
in  relation  to  other  factor&j  And  in  the  last  analysis,  as  all  the 
experts  in  this  field  agree,  the  ultimate  test  of  a  worker's  adap- 
tability for  a  job  is  the  way  in  which  he  does  it.  This  means 
that  the  use  of  special  tests  as  the  sole  basis  for  selection  or  rejec- 


METHODS  OF  SELECTION  AND  PLACEMENT  55 

tion  of  applicants  would  in  general  be  unwarranted  today. 
They  should  not,  says  one  expert,  "be  given  for  the  sake  of  elimi- 
nation, but  for  the  sake  of  placing  each  individual  in  the  position 
that  requires  his  particular  degree  of  intelligence."1 

Intelligence  Tests. — General  intelligence  tests  are  now  availa- 
ble which  throw  considerable  light  upon  an  individual's  mental 
alertness,  speed  of  learning  and  mental  capacity.2     And  there 
appears  to  be  usually  a  correlation  between  general  intelligence  ,^- 
and'  that  quality  of  effectiveness  in  action  which  is  commonly  ^ 
spoken  of  as  "  ability  to  get  on  in  the  world."     The  tests  "do  not       . 
measure  loyalty,  bravery,  power  to  command,  or  the  emotional, 
traits  that  make  a  man  carry  on.     However,  in  the  long  run  these 
qualities  are  far  more  likely  to  be  found  in  men  of  superior  intelli- 
gence than  in  men  who  are  intellectually  inferior."3 

Within  these  definite  limits  in  which  intelligence  tests  claim 
to  be  valuable,  they  have  proved  exceedingly  useful.  But  those 
limits  should  be  kept  clearly  in  view.  The  intelligence  test 
appears  to  offer  little  evidence  as  to  the  individual's  total  intel- 
lectual equipment.  It  is  distinctly  not  an  index  to  specific 
mental  traits,  nor  to  moral  characteristics  such  as  honesty,  trust- 
worthiness and  the  like.  "No  psychologist,"  we  are  told,  "has 
as  yet  presented  us  with  such  a  complete  and  comprehensive 
analysis  of  the  mental  aptitudes  that  are  essential  for  any  single 
occupation."4  And,  it  may  be  added,  even  if  such  aptitudes 
were  clearly  known,  methods  of  identifying  them  still  remain  to 
be  discovered. 

1  ARTHUR  AND  WOODBOW.     An  Absolute  Intelligence  Scale:   A  Study  in 
Method.     Journal  of  Applied  Psychology,  v.  3,  No.  2,  June,  1919,  p.  119. 

2  It  is  beyond  the  scope  of  this  chapter  to  describe  the  substance  and 
methods  of  using  intelligence  tests.     The  reader  is  referred  for  adequate 
treatment  of  this  technical  problem  to — 

Personnel  Work  in  the  U.  S.  Army.  Committee  on  Classification  of 
Personnel  in  the  Army,  War  Department,  Washington,  1919. 

Army  Mental  Tests.  Committee  on  Classification  of  Personnel  in  the 
Army,  War  Department,  Washington,  Nov.  22,  1918. 

The  Personnel  System  of  the  U.  S.  Army,  Washington,  1919,  v.  2,  Ch.10. 

Copies  of  the  intelligence  tests  used  by  the  Army  are  available  for  free 
distribution. 

To  explain  the  uses  of  these  tests  one  should  see  the  examiner's  guide 
now  published  by  Henry  Holt  &  Co.,  N.  Y. 

3  The  Personnel  System  of  the  U.  S.  Army,  v.  2,  p.  228. 

4  WHIFFLE,  G.   M.     The  Use  of  Mental  Tests  in  Vocational  Guidance, 
Annals,  American   Academy,  May,   1916,  p.   196. 


56  PERSONNEL  ADMINISTRATION 

Nevertheless  intelligence  tests  can  helpfully  be  used  to  reen- 
force  decisions  in  cases  where  there  is  doubt  about  which  of  two 
or  three  workers,  otherwise  equal,  should  be  selected  for  a  posi- 
tion. It  is  probably  true  at  many  types  of  work  that  the  selec- 
tion of  the  candidate  who,  his  other  qualifications  being  equal, 
has  a  higher  intelligence  test  score,  is  the  wise  selection.  Of  two 
workers  who  test  equally  at  a  trade  test,  the  one  who  excels  on 
the  intelligence  test  would  probably  be  the  preferable  worker; 
and  he  would  also  probably  make  the  better  gang  leader  or  fore- 
man. Of  two  assistant  foremen  whose  ratings  in  technical  know- 
ledge, ability  to  handle  men  and  other  desirable  characteristics 
are  equal,  advancement  to  foremanship  would  probably  be 
wisely  given  to  the  one  with  the  higher  intelligence  test  score. 

In  the  present  state  of  experiment  with  this  type  of  test  its 
use  can,  therefore,  be  only  broadly  corroborative  rather  than 
absolutely  indicative. 

Trade  Tests. — There  is  more  reason  to  give  weight  to  the 
results  of  trade  tests  as  indices  of  working  fitness  than  to  the 
results  of  more  generalized  tests.  Where  the  work  in  question 
has  a  varied  and  defined  body  of  knowledge  and  methods  with 
which  the  worker  must  be  familiar,  a  trade  test  can  usually  help 
to  discover  the  qualified  journeyman. 

A  trade  test  is  a  set  of  trade  questions  to  which  specific  and 
correct  answers  cannot  be  given  by  the  applicant  without  a  degree 
of  trade  experience;  or  it  takes  the  form  of  pictures  in  which  the 
applicant  identifies  and  names  parts  or  tools;  or  it  is  a  perform- 
ance test  at  some  particular  part  of  the  work;  or  it  may  be  any 
combination  of  these  three.  And  the  tests  are  devised  with  the 
intention  of  enabling  the  examiner  to  classify  the  worker  into 
one  of  four  grades  of  trade  skill  — the  novice,  the  apprentice, 
the  journeyman,  and  t  Inexpert. 

Success  in  the  use  of  this  type  of  test  depends  largely  upon  the 
intelligence  with  which  it  is  administered.  It  is  claimed  that 
the  trade  test  can  be  applied  successfully  by  one  wholly  unfamiliar 
with  the  trade;  but  conclusions  from  such  a  statement  must  be 
drawn  with  caution.  For  in  the  actual  use  of  these  tests  in  the 
shop,  it  will  be  necessary  for  the  examiner  to  gauge  how  great 
a  part  such  a  factor  as  previous  coaching  for  the  test  is  playing. 

In  so  far  as  they  are  carefully  used,  however,  trade  tests  prom- 
ise to  bring  real  help  in  the  work  of  classifying  craftsmen.  One 
of  the  points  of  standing  controversy  wherever  craftsmen  are 


METHODS  OF  SELECTION  AND  PLACEMENT  57 

employed  is  the  degree  of  their  trade  skill.  A  method  of  differ- 
entiating the  journeyman  from  the  apprentice  and  the  expert 
from  the  journeyman,  which  workers  and  managers  agree  to  be 
reliable,  is  greatly  needed  and  would  if  jointly  controlled  elimi- 
nate considerable  unnecessary  dispute  about  the  worker's  trade 
standing. 

Summing  up  the  likelihood  of  trade  tests  being  used  in  indus- 
try, Lieutenant  Colonel  W.  V.  Blngham  gives  the  following 
interesting  and  authoritative  judgment: 

"Trade  tests  of  this  comprehensive  type  (i.e.,  British  method  of 
securing  systematic  and  exhaustive  inventory  of  the  candidate's  trade 
ability)  may  some  day  find  a  place  of  usefulness  in  connection  with  the 
educational  program  of  large  corporations  and  of  trade  schools.  Some 
employment  departments  will  find  value  in  the  briefer  American  Army 
type  of  standardized  trade  tests,  provided  they  have  the  funds  and  the 
personnel  to  maintain  a  competent  trade  test  examiner  and  provided 
they  continue  the  expensive  process  of  progressive  revision  and  restand- 
ardization  which  seems  to  be  indispensable  to  offset  the  dangers  of 
coaching. 

"Most  employment  departments  will  not  care  to  undertake  this  pro- 
gram, but  they  will  come  instead  to  the  use  of  an  abbreviated  form  of 
oral  examination  which  we  may  call  the  'technical  interview.'  These 
technical  interviews  will  resemble  oral  tests  in  that  they  will  consist  of 
precisely  such  questions  as  have  been  found  most  useful  in  the  oral 
trade  tests.  But  they  will  not  be  administered  with  such  rigor  of  pro- 
cedure, nor  will  they  yield  a  numerical  rating.  They  will,  however, 
serve  to  clarify  the  interviewer's  opinion  of  the  candidate's  ability,  and 
will  be  a  convenient  and  very  useful  first  aid  in  employment  and  place- 
ment."1 

Special  Abilities  Tests. — There  is  still  another  type  of  test, 
designed  to  discover  some  special  ability  or  combination  of 
abilities.  The  interesting  methods  discussed  in  Mr.  Link's 
book2  are  almost  altogether  of  this  character.  His  tests  were 
utilized  to  detect  such  abilities  as  manual  dexterity,  rapidity 
with  which  assembly  work  could  be  done  and  quickness  of  the 
eye.  He  makes  no  large  claims  for  the  success  of  tests  of  this 
type  although  his  experience  appears  to  leave  him  hopeful.  He 
concludes  his  discussion,  however,  by  saying  that  "the  process  of 

1  BINGHAM,    W.    V.     Measuring  a  Workman's  Skill.     Bulletin   No.   30, 
National  Society  for  Vocational  Education,  Feb.,  1919. 

2  LINK,  H.  C.     Employment   Psychology.     See   also   MUNSTERBURG,  H. 
Psychology  and  Industrial  Efficiency. 


58  PERSONNEL  ADMINISTRATION 

finding  and  applying  tests  is  based  upon  the  closest  and  most  con- 
tinuous study  of  actual  people  actually  at  work.  Experiment 
must  follow  experiment  in  order  to  obtain  the  means  by  which 
the  applicant's  abilities  can  best  be  determined."1 

It  is  reasonable  to  draw  the  conclusion  from  the  summary 
evidence  here  presented  that  selective  tests  are  not  yet  ready  to 
be  applied  throughout  industry  without  great  caution  and  con- 
tinuous expert  advice  in  their  introduction  and  use.  Great  as 
is  the  promise  of  such  refined  methods  of  selection,  manap  T- 
will  only  injure  a  fundamentally  sound  idea  if  they  apply  it  too 
quickly  and  with  too  much  confidence  in  the  results. 

There  is,  for  the  immediate  future,  much  greater  need  that 
managers  should  perfect  the  technique  of  the  necessary  selection 
procedure  and  adopt  those  minimum  standards  discussed  in  the 
other  sections  of  this  chapter.  Until  interviews  are  privately 
conducted,  until  ten  minutes  rather  than  two  minutes  is  given  to 
an  interview,  until  an  effort  is  made  to  show  the  man  the  work 
and  follow  him  up  on  the  job,  there  is  little  use  in  applying  more 
scientific  methods  which  presuppose  at  least  some  conception  of 
the  conditions  which  must  surround  a  sensible  process  of  selection. 
t\  Rating  Scales. — A  further  device  which  is  not  a  selective  test 
in  the  narrow  sense  is  the  rating  scale.  But  since  it  may  be 
used  to  throw  light  upon  the  relative  fitness  of  the  members  of  a 
group  for  a  given  position,  it  may  become  an  aid  in  selecting 
the  person  for  that  position.  It  has  no  value  for  the  selection  of 
new  workers  or  new  executives  brought  in  from  outside;  but  its 
use  in  selecting  executives  for  promotion  may  come  to  be  con- 
siderable. 

The  rating  scale  has  been  so  well  characterised  and  its  possible 
application  to  industry  so  well  suggested  by  a  previous  writer 
that  we  quote  his  statement. 

A  rating  scale,  says  Mr.  P.  J.  Reilly,2  "is  a  practical  plan,  by  mean< 
of  which  an  officer's  capacity  and  fitness  for  promotion  can  bo  gauged 
quickly  and  accurately.  It  is  the  official  method  of  rating  all  commis- 
sioned officers.  Each  officer  i>  rnn.-idered  in  the  important  qualifica- 
tions and  is  rated  one  at  a  time  in  tli<»<-  qualities,  which  areas  follows: 
1 -Physical  qualities;  2-Intelligence;  3-Leadership;  4-Personal  qualities; 
5-General  value  to  the  service. 

'LINK,  II.  ('.     o/i.  ril..  P.  :;• 

f  KEILLY,  1'.  J.     Tin-  Rating  S.-alr  in  Industry.     Pernon/iel,  July,  1919. 


METHODS  OF  SELECTION  AND  PLACEMENT  59 

"To  obtain  a  standard  for  comparison,  each  rating  officer  takes  five 
officers  to  represent  grades  from  the  highest  to  the  lowest  among  the 
officers  of  a  named  rank  whom  he  knows,  and  uses  them  as  the  measure 
for  one  of  the  five  qualifications. 

"The  experience  in  the  Army  with  the  officer's  rating  scale  has  been 
extensive  enough  to  establish  definitely  its  value,  and  a  number  of 
industrial  concerns  have  already  introduced  a  rating  scale  in  their  per- 
sonnel practice  as  a  means  of  rating  selected  groups  of  executives  or 
important  employees.  Interest  seems  directed  especially  to  the  use  of 
a  rating  scale  for  foremen.  Among  the  industrial  companies  which  al- 
ready have  made  beginnings  in  developing  a  rating  scale  for  foremen  are 
the  following:  Art  in  Buttons,  Rochester,  N.  Y.;  American  Rolling  Mill 
Co.,  Middletown,  Ohio;  The  Domestic  Engineering  Co.,  Dayton,  Ohio; 
and  the  Dennison  Mfg.  Co.,  Framingham,  Mass. 

"It  is  significant  that  attempts  are  being  made  to  appraise  the  fore- 
man accurately  and  to  define  his  job.  Such  an  appraisal  of  foremen 
must  be  in  terms  of  their  jobs  and  a  definite  knowledge  of  jobs  is  neces- 
sary. For  the  latter  purpose,  job  specifications  for  foremen  are  al- 
ready being  developed  by  some  companies  so  as  to  guide  them  in  the 
selection,  training  and  placement  of  foremen.  For  the  rating  of  fore- 
men, however,  much  dependence  will  be  placed  upon  a  rating  scale  in 
the  future. 

"In  the  preparation  of  rating  scales,  success  will  be  achieved  only  if 
the  following  requirements  are  met: — 

(a)  They  should  contain  those  qualities  which  are  essential  in  the 
judgment  of  a  man's  fitness  for  some  specific  purpose. 

(6)  They  must  'weight'  or  indicate  the  relative  value  of  the 
qualities  deemed  most  essential. 

(c)  They  must  give  a  numerical  expression  of  the  degree  in  which 
a  man  possesses  those  qualifications. 

(d)  They   must   be   capable  of  securing   uniform  ratings, — that  is 
to  say,   two  competent  judges,  judging  independently  must  be  able 
to  rate  the  same  man  with  only  a  negligible  difference  between  their 
ratings. 

(e)  They  must  enable  the  judges  to  rate  quickly  and  accurately. 

"The  scale  was  first  tried  out  (in  the  Dennison  Mfg.  Co.)  in  a  tenta- 
tive way  and  when  it  definitely  was  adopted  in  its  present  form,  it  was 
presented  to  the  foremen  in  a  group  conference.  At  this  conference 
copies  of  the  scale  were  distributed  to  each  foreman  and  they  were 
told  precisely  what  the  scale  was,  what  it  was  expected  to  do,  and  why 
it  seemed  desirable  to  use  it.  Criticisms  of  the  scale  were  invited  from 
the  foremen  and  everything  was  considered  in  the  development  of  the 
scale  that  gave  promise  of  being  of  help  in  obtaining  an  effective  scale 
that  could  be  fairly  used." 


60  PERSONNEL  ADMINISTRATION 

We  return  now  from  the  consideration  of  special  tests,  to  the 
procedure  of  selection  at  that  point  where  any  existing  tests 
have  been  successfully  met  and  the  applicant  has  been  hired. 

Progress  Cards  and  References. — As  a  rule,  the  data  gathered 

U 

in  the  interview  is  a  more  reliable  guide  in  choosing  employees 
than  references.  For  unskilled  and  semi-skilled  laborers  this 
is  especially  true.  However,  a  new  type  of  recommendation, 
called  a  progress  card,  is  coming  into  use.  It  is  modelled  after 
the  service  certificates  of  the  army,  and  contains  a  signed  state- 
ment by  the  former  employer  as  to  the  time  that  the  man  has 
been  with  the  firm,  his  regularity  of  attendance,  the  kind  of  work 
in  which  he  has  been  engaged,  and  the  evidences  of  his  initia- 
tive and  reliability.  If  they  become  an  accepted  part  of  the 
hiring  and  discharge  procedure  they  should  be  of  real  help  in 
the  problem  of  selection. 

Despite  their  scientific  value,  however,  such  "discharge  books" 
could  obviously  be  used  with  serious  injustice  to  the  workers. 
And  they  are  for  that  reason  to  be  viewed  with  caution.  Only 
under  a  union  shop  regime,  where  joint  control  over  terms  and 
conditions  of  employment  was  well  established,  could  any  such 
permanent  and  transferable  record  of  individual  characteristics 
or  performance  be  fairly  used. 

The  Applicant  Who  Must  be  Turned  Away. — When  there  is 
no  intention  of  hiring  a  man,  it  is  poor  practice  to  permit  him  to 
fill  out  an  application  blank.  It  gives  him  a  hope  for  which  there 
is  no  foundation,  and  clutters  up  the  file  with  useless  cards. 

Some  personnel  administrators,  when  they  are  obliged  to 
turn  promising  men  away,  attempt  to  secure  work  for  them  in 
other  plants  in  the  vicinity.  In  fact,  in  several  industrial  centers 
it  is  the  custom  for  the  employment  managers  to  telephone  to 
each  other  the  first  thing  in  the  morning  to  discover  what  type 
of  help  is  needed.  They  then  make  an  effort  to  direct  the  right 
man  into  the  right  position  whether  in  their  own  factory  or  in 
that  of  another  firm.  Helpful  exchanges  often  take  place. 
Such  cooperative  procedure  in  selection  and  follow-up  has  great 
possibilities. 

Final  Authority  in  Selection. — In  the  factory  in  which  the  per- 
sonnel department  has  become  well  established,  and  the  executive 
force,  especially  the  foremen,  have  come  to  realize  its  helpfulness, 
it  is  probably  advisable  in  most  cases  to  have  final  authority  in 
hiring  rest  with  that  department.  This  does  not  mean  that  those 


METHODS  OF  SELECTION  AND  PLACEMENT  61 

under  whose  direct  supervision  the  employees  will  work  should  not 
be  consulted.  Their  estimates  of  the  type  of  man  needed,  and 
their  contributions  to  job  analyses  are  very  necessary.  Their 
full  approval  of  the  final  results  of  the  selection  is  of  course  es- 
sential. Yet  to  maintain  the  plant's  employment  standards  and 
to  direct  newcomers  in  the  most  intelligent  way  into  work  for 
which  they  show  a  liking,  it  has  been  found  most  satisfactory  to 
have  responsibility  for  engaging,  selecting  and  discharging  the 
manual  workers  under  the  personnel  administrator. 

Introducing  the  Worker  to  the  Plant. — The  next  distinct 
step  in  employment  procedure  after  selection  is  the  introduction 
of  workers  to  the  plant.  This  also  is  a  function  of  the  personnel 
department.  Upon  the  manner  and  spirit  of  this  introduction 
the  employee's  first  impression  depends  not  a  little. 

The  first  step  in  this  introductory  process  may  well  be  an  oral 
explanation  of  the  company's  policies.  Some  firms  in  addition 
to  distributing  an  informational  booklet,  go  over  the  contents  of 
this  handbook  with  groups  of  new  workers  in  order  to  make 
perfectly  plain  the  material  it  contains.  This  method  of  sup- 
plementing a  reading  which  may  never  take  place  or  may  be 
hurriedly  done,  is  highly  desirable.  It  is  with  any  group  of 
people  a  mistake  to  think  that  the  printed  page  can  of  itself 
take  the  place  of  verbal  communication. 

The  information  and  regulations  .contained  in  the  booklet 
cannot  be  too  explicit.  There  should  be  no  occasion  for  a  mis- 
understanding about  pay,  hours,  shop  rules,  safety  regulations, 
provisions  regarding  tardiness  and  absence,  overtime,  training 
and  insurance.  After  the  items  on  these  points  have  been  made 
clear  in  conversation,  the  booklet  which  repeats  in  full  the  con- 
tents of  the  talk,  should  be  distributed.  It  should  be  stamped 
with  the  employee's  name  and  number  and  be  used  by  him  for 
reference. 

The  new  worker  is  then  ready  to  be  personally  conducted 
through  the  plant.  In  larger  plants  special  messengers  are 
available  to  show  him  the  lunch,  rest,  and  hospital  rooms,  and 
assign  him  his  locker.  They  also  point  out  the  location  of 
toilets,  bubblers,  exits  and  fire  escapes;  and  explain  the  use  of 
the  time  clock.  Finally,  they  take  him  to  the  department  to 
which  he  has  been  assigned. 

The  new  employee  should  be  left  with  the  foreman  only  when 
the  latter  has  time  to  give  him  the  proper  attention. 


62  PERSONNEL  ADMINISTRATION 

Specifically  the  foreman  should  be  introduced  to  the  newcomer 
by  an  intelligible  interchange  of  names.  The  foreman  might 
then  put  the  worker  in  charge  of  an  assistant  or  of  an  instructor, 
who  would  in  turn  be  responsible  for  making  the  worker  known 
in  a  friendly  way  to  his  working  associates.  They  should  be 
told  his  name,  and  he  be  told  theirs. 

From  this  point  the  procedure  usually  becomes  a  matter  of 
training.  Some  firms  take  the  new  worker  on  a  visit  through  the 
plant  in  order  that  he  may  know  what  he  is  helping  to  make  and 
see  the  importance  of  his  job  in  relation  to  the  whole  process. 
Some  firms  put  the  employee  immediately  in  charge  of  a  job 
instructor,  and  others  also  assign  a  fellow-worker  to  the  new 
man  to  help  familiarize  him  with  the  procedure  of  the  plant — to 
act  as  a  "big  brother." 

Indeed,  some  plants  make  it  a  practice  to  have  a  higher  ex- 
ecutive— a  general  foreman  or  an  assistant  superintendent — in- 
troduce himself  and  chat  a  few  minutes  with  each  new  employee 
in  the  departments  under  him.  And  the  foreman  himself  can 
usually  well  afford  to  give  some  encouragement  to.  the  novice  once 
every  day  during  the  first  week. 

To  have  the  laborer  enter  upon  his  job  thus  with  the  manifest 
sympathy  and  knowledge  of  the  entire  organization,  not  only 
eliminates  waste  of  time  and  misunderstanding  but  it  tends  to 
assure  in  the  worker's  mind  a  positive  conviction  that  he  is  really 
wanted  and  welcome  in  the  plant.  Good  manners  and  cour- 
teous treatment  have  a  value  in  industry  which  is  no  less  sig- 
nificant than  it  is  in  other  social  intercourse.  It  is  a  value  that 
makes  true  courtesy  worth  striving  for  and  worth  studying  to 
achieve. 

Following-up  the  New  Employee. — Careful  follow-up  methods 
are  essential  to  round  out  properly  a  minimum  program  of  selec- 
tion and  placement. 

The  importance  of  this  follow-up  is  apparent.  The  largest 
percentage  of  labor  turnover  occurs  during  the  first  three  months. 
The  worker  is  at  the  outset  in  peculiar  need  of  friendly  advice  and 
attention.  The  process  is  one  in  which  the  employment  division, 
foremen,  and  instructors  must  all  cooperate.  However,  the 
actual  work  of  checking  up  the  success  of  the  selection  is  usually 
beet  done  by  the  interviewers,  who  in  well  organized  plants  are 
being  given  the  afternoons  or  the  last  days  of  the  week  to  go  into 


METHODS  OF  SELECTION  AND  PLACEMENT  63 

the  factory  and  talk  again  with  those  whom  they  have  selected 
several  days  before. 

The  attitude  with  which  all  this  follow-up  should  be  done 
should  reflect  a  neighborly  and  comradely  spirit.  The  brother- 
hood bond  in  industry  is  so  often  destroyed  by  the  machine,  that 
acquaintance  and  goodwill  are  promoted  only  by  personal  effort. 
The  foreman  alone  cannot  restore  it.  The  personnel  depart- 
ment alone  cannot  restore  it;  nor  the  fellow  employees  acting 
alone.  The  process  of  friendly  introduction  and  of  coming  to  feel 
at  home  requires  the  studied  but  still  spontaneous  cooperation  of 
all  in  the  management,  and  of  all  the  men. 

In  its  assistance  in  transfer  and  promotion,  follow-up  has 
another  task  to  perform.  It  estimates  a  man's  all-round  fit- 
ness for  his  job,  studies  his  attitude,  and  measures  his  progress. 
And  if  the  interviewer  is  found  to  be  mistaken  in  his  original 
placement,  he  assigns  the  worker  to  a  position  for  which  he  is 
better  fitted.  The  result  is  not  only  positive  saving  of  time  and 
expense  in  the  induction  of  beginners,  but  also  a  longer  tenure  of 
office  by  more  efficient  and  happier  employees. 

The  Social  Importance  of  Standards  of  Selection  and  Place- 
ment.— Never  has  the  need  of  wise  and  humane  methods  of 
selection  and  placement  been  more  imperatively  felt  than  at  the 
present  time,  when  full  conservation  of  all  the  factors  in  produc- 
tion is  urgent.  This  chapter  has  suggested  simply  minimum 
standards, — standards  below  which  no  factory's  procedure  of 
selection  need  fall,  and  for  which  no  great  expense  is  entailed. 
It  remains  for  individual  plants  to  enlarge  upon  them  as  the 
results  justify. 

What  the  interviewer  is  really  doing  in  the  selection  process  is 
to  distribute  personal  power.  Progress  in  industry  is  from  one 
point  of  view  registered  in  the  wise  expenditure  of  personal 
energy  and  wise  direction  of  individual  talents.  It  is  therefore 
not  only  good  business  but  a  public  duty  for  the  interviewer  to 
adapt  the  diverse  talents  of  applicants  to  the  opportunities  in 
industry  in  the  most  humanly  scientific  manner  possible.  It 
is  his  important  contribution  to  a  genuine  industrial  efficiency. 

Control  of  Employment  Standards. — Our  discussion  of  selec- 
tion has  proceeded  on  the  assumption  that  employment  standards 
were  immutably  fixed  by  the  management.  We  have  spoken 
as  though  managers  alone  determined  what  degree  of  skill 
warranted  employment,  what  length  of  prior  training  was 


64  PERSONNEL  ADMINISTRATION 

required,  what  age  and  sex  of  worker,  etc.,  were  necessary  for  given 
jobs.  This  is  undoubtedly  true  today  in  the  large  number  of 
plants. 

But  standards  of  selection  are  destined  to  be  more  and  more 
subject  to  joint  determination  and  control.  Already  wherever 
the  workers  are  strongly  organized  they  have  considerable  to 
say  about  just  the  above  items;  and  the  only  serious  problem  is  to 
see  to  it  that  this  determination  of  employment  standards  takes 
place  on  an  intelligent  and  socially  satisfactory  basis.  For 
if  these  standards  are  too  rigid,  the  supply  of  trained  workers 
may  become  so  scarce  that  they  can  command  a  relatively  too 
large  reward  for  their  services,  or  good  workers  may  be  barred 
from  socially  necessary  work. 

Moreover,  one  of  the  employer's  rightful  objections  under  most 
"closed"  or  union  shop  arrangements  is  that  employment 
standards  are  in  reality  set  for  him  by  the  union  which  all  must 
join  who  seek  employment.  The  remedy  in  such  cases  may  not 
be  easy  to  apply;  but  it  seems  reasonably  apparent. 

The  remedy  is  to  make  employment  standards  specifically  a 
matter  for  joint  negotiation.  And  this  negotiation  if  it  is  to  be 
any  improvement  on  arbitrary  decisions  either  by  managements 
or  by  unions,  must  be  based  on  facts  which  both  admit.  Such 
facts  as  are  necessary  are  the  product  of  job  analysis  and  are 
unobtainable  without  job  analysis.  How  this  analysis  is  to  be 
carried  on,  what  matters  it  should  study,  what  results  can  be 
expected, — these  are  questions  whose  consideration  is  deferred 
until  a  later  chapter. 

Meanwhile,  it  is  our  conclusion  that  employment  standards 
and  therefore  all  selection  methods  should  be  based  on  careful 
study  of  the  work  to  be  done,  and  upon  agreement  between 
management  and  men  regarding  those  standards  and  methods 
which  shall  have  force. 

Selected  References 
GENEHAL 

FRANKEL,  L.  K.  and  OTIIKRS.     Hiring  and  Firing.     N.  Y.,  Metropolitan 

Life  Insurance  Co.,  1918,  pp.  23-38. 
GARDNER,  H.  L.     Selection  Problem  of  Cheney  Bros.     (U.  S.  Bureau  of 

Labor  Statistics.     Bui.  No.  227,  1917,  pp.  12O-125.) 
HUBY,  KATHKRINK.     Problems  Arising  and  Methods  Used  in  Interviewing 

and  Selecting  Employees.     (Annals,   American  Academy,   v.  66,  pp. 

909-218.) 


METHODS  OF  SELECTION  AND  PLACEMENT  65 

KELLY,  R.  W.  Hiring  the  Worker.  N.  Y.,  Engineering  Magazine  Co., 
1918,  pp.  57-99. 

LINK,  H.  C.  Employment  Psychology.  N.  Y.,  Macmillan  Co.,  1919, 
pp.  293-391. 

MANN,  C.  R.  Study  of  Engineering  Education.  N.  Y.,  Carnegie 
Foundation  for  Advancement  of  Teaching,  1918,  pp.  67-74. 

REILLY,  P.  J.  Selection  and  Placement.  (National  Association  of  Em- 
ployment Managers.  Proceedings,  1st  annual  convention,  Cleveland, 
Ohio,  May  21-23,  1919,  pp.  49-56.) 

SCHNEIDER,  HERMAN.  Selecting  Men  for  Jobs.  (Engineering  Magazine 
Co.,  v.  51,  pp.  420-431,  June,  1916.) 

SCOTT,  W.  D.  Scientific  Selection  of  Salesmen.  (Advertising  and  Selling 
Magazine,  v.  25>  pp.  5-6,  94-6;  v.  11,  pp.  55,  69-70.  Oct.-Dec.,  1915.) 

Scon,  W.  D.  Selection  of  Employees  by  Means  of  Quantitative  Deter- 
minations. (Annals,  American  Academy,  v.  65,  pp.  182-193.) 

SCOTT,  W.  D.     Vocational  Selection  at  the  Carnegie  Institute  of  Tech- 
nology.    U.  S.   Bureau  of  Labor  Statistics.     Bui.  No.  227,  1917,  pp. 
114-119.) 

•SLIGHTER,  S.  H.  Turnover  of  Factory  Labor.  N.  Y.,  D.  Appleton  & 
Co.,  1919,  pp.  281-325. 

U.  S.  SHIPPING  BOARD,  EMERGENCY  FLEET  CORPORATION.  Selection  and 
Placement  of  the  Worker.  Bid.  No.  III.  Philadelphia,  pub.  by 
Corporation,  1919. 

"WEBB,  SIDNEY.  Works  Manager  Today.  N.  Y.,  Longmans,  Green  & 
Co.,  1918,  pp.  21-33. 

SPECIAL  TESTS 

ARTHUR,  GRACE  and  HERBERT  WOODROW.  Absolute  Intelligence  Scale;  a 
Study  in  Method.  (In  Journal  of  Applied  Psychology,  v.  3,  pp.  118- 
137,  June,  1919.) 

BINGHAM,  W.  V.  Army  Personnel  Work,  with  Some  Implications  for 
Education  and  Industry.  (In  Journal  of  Applied  Psychology,  v.  3, 
pp.  1-12,  March,  1919.) 

CHAPMAN,  J.  C.  Mental  Tests  in  Industry.  (In  Personnel,  the  Employ- 
ment Managers'  Bulletin,  v.  1,  No.  3,  pp.  1-9,  March,  1919.) 

GREENWOOD,  G.  W.  Simple  Tests  for  Office  Applicants.  (In  Industrial 
Management,  v.  57,  pp.  377-378,  May,  1919.) 

JAQUES,  M.  P.  Mental  Tests  for  Typists  and  Stenographers.  (In  In- 
dustrial Management,  v.  58,  pp.  145-147,  August,  1919.) 

KELLEY,  T.  L.  Principles  Underlying  the  Classification  of  Men.  (In 
Journal  of  Applied  Psychology,  v.  3,  No.  1,  pp.  50-67,  March,  1919.) 

LINK,  H.  C.  Employment  Psychology;  the  Application  of  Scientific 
Methods  to  the  Selection,  Training  and  Grading  of  Employees. 
N.  Y.,  Macmillan  Co.,  1919. 

NATIONAL  ASSOCIATION  OF  CORPORATION  SCHOOLS.  Committee  on  Em- 
ployment Psychological  Tests  and  Results  Obtained  Therefrom. 
(National  Association  of  Corporation  Schools.  Addresses,  Reports, 
etc.,  7th  Annual  Proceedings,  Chicago,  June  2nd-6th,  1919,  pp.  342- 
366.) 
5 


66  PERSONNEL  ADMINISTRATION 

REILLY,  P.  J.  Rating  Scale  in  Industry.  (In  Personnel,  the  Employment 
Managers'  Bulletin,  v.  1,  No.  7,  pp.  1,  3  and  6,  July,  1919.) 

RUML,  BEARDSLEY.  Extension  of  Selective  Tests  to  Industry.  (In  Annals, 
American  Academy,  v.  81,  pp.  38-46,  Jan.,  1919.) 

SCOTT,  W.  D.  Measurement  of  Trade  Skill  and  Intelligence.  (In  National 
Association  of  Employment  Managers.  Proceedings,  1st  Annual 
Convention,  Cleveland,  Ohio,  May  21-23,  1919,  pp.  63-68.) 

SCOTT,  W.  D.  Selection  of  Employees  by  Means  of  Quantitative  Deter- 
minations. (In  Annals,  American  Academy,  v.  65,  pp.  182-193.) 

THE  PERSONNEL  SYSTEM  OF  THE  UNITED  STATES  ARMY,  CLASSIFICATION 
DIVISION.  Adjutant  General's  Rept.  C.  C.  P.  400,  Washington,  1919, 
v.  1  and  2. 

THORNDIKE,  E.  L.  A  Standardized  Group  Examination  of  Intelligence 
Independent  of  Language.  (In  Journal  of  Applied  Psychology,  v.  3, 
No.  1,  pp.  13-32,  March,  1919.) 

WHIPPLE,  G.  M.  Use  of  Mental  Tests  in  Vocational  Guidance.  (In 
Annals,  American  Academy,  v.  65,  pp.  193-204,  May,  1916.) 

YOAKUM,  C.  S.  and  B.  M.  YERKES.  Army  Mental  Tests.  N.  Y.,  Henry 
Holt  &  Co.,  1920. 


CHAPTER  VII        LA- 
BOURS AND  WORKING  PERIODS 

Consideration  of  methods  of  selection  might  reasonably  be 
followed  by  a  statement  of  the  terms  of  employment  at  which 
new  workers  are  engaged.  Wages  and  hours  constitute,  of 
course,  two  of  the  major  terms  of  employment;  but  our  exposi- 
tion of  payment  will  be  more  illuminating  if  instead  of  coming 
now  it  follows  our  study  of  job  analysis.  We  shall  therefore 
consider  only  hours  and  working  periods  here;  and  then  proceed 
to  discuss  the  health  of  the  worker  and  the  conditions  of  the 
factory  into  which  he  enters/ — in  other  words,  his  "working 
conditions." 

Our  treatment  of  the  hours  problem  will  not  attempt  the  im- 
possible. There  is  today  no  scientific  data  at  hand  to  prove  what 
length  of  working  day  is  the  most  "productive"  in  a  sense  which 
takes  account  of  both  output  and  human  factors.  And  even  if 
there  were  such  data,  it  must  be  remembered  throughout  the 
discussion  of  these  matters  that,  since  working  hours  are  funda- 
mentally a  matter  for  determination  by  a  negotiating  process, 
other  considerations  than  science  help  to  determine  (and  pre- 
sumably always  will)  the  length  of  working  day  and  week  actually 
adopted.  The  range  of  the  bargaining  discussion  can  no  doubt 
be  somewhat  narrowed  by  joint  possession  of  the  facts;  and  for 
that  reason  we  shall  state  what  seem  to  us  the  relevant  elements 
in  the  problem.  But  we  shall  attempt  to  prove  nothing  about  the 
proper  length  of  working  periods.  The  purpose  of  this  chapter 
is  rather  to  enumerate  the  several  topics  relating  to  the  time 
factor,  upon  which  some  defined  policy  should  be  adopted:  and  to 
suggest  briefly  the  consensus  of  recent  opinion  and  practice  upon 
these  topics. 

A  second  prefatory  word  will  save  repetition  as  we  proceed. 
Policy  on  all  of  the  time  factors  should  be  clear,  explicit,  known  to 
all  workers,  and  acquiesced  in  by  all  workers.  Acceptance  and 
satisfactory  administration  of  all  the  following  items  will  there- 
fore in  most  cases  be  better  assured  if  there  is  prior  conference 

67 


68  PERSONNEL  ADMINISTRATION 

and  joint  agreement  with  the  workers  upon  the  terms  adopted. 
Just  because  other  considerations  than  absolute  facts  enter  into 
the  determination  of  working  periods;  just  because  individual 
and  group  desires,  conventions  and  habits  help  to  mold  sentiment 
on  this  question,  it  will  be  better  business  to  have  a  common 
understanding  and  an  explicit  agreement  upon  the  time  factors. 
Further  reasons  for  joint  action  in  this  field  and  methods  for 
safeguarding  such  joint  action  are  discussed  from  time  to  time 
in  subsequent  chapters. 

Furthermore,  in  discussing  hours  a  combination  of  points  of 
view  must  be  borne  in  mind.  Managers  must  remember  that 
the  worker  is  in  the  first  instance  a  "physico-chemical  engine" 
which  requires  time  in  which  to  renew  wastage,  by  sleep  and 
recreation;  that  the  worker  is  possessed  of  a  human  nature 
which  demands  expression  for  a  known  variety  of  native  impulses; 
that  the  worker  is  a  member  of  a  community  with  responsi- 
bilities toward  family  and  state  which  he  should  assume  and  be 
competent  to  carry  out  worthily.  Without  the  background  of 
judgment  and  the  broader  approach  to  the  hours  problem  which 
these  points  of  view  encourage,  the  manager  will  be  in  danger  of 
seeking  decisions  on  a  too  narrow  basis  of  facts  or  opinions.  The 
hours  question  like  all  the  rest  which  we  are  considering,  cannot 
be  dissociated  from  the  problem  of  securing  the  worker's  interest, 
energy,  and  goodwill. 

A  reasonable  limitation  of  working  periods  has,  also,  special 
values  for  the  whole  executive  staff,  especially  for  the  foremen 
who  are  usually  confined  closely  to  their  departments  during 
every  minute  of  the  working  week,  and  are  likely  to  suffer  from 
the  narrowness  which  such  confinement  inevitably  brings. 
Frequently  foremen,  assistant  superintendents  and  technical 
experts  are  necessarily  in  the  plant  longer  than  any  one  else; 
and  their  long  hours  of  continuous  application  contribute  not  a 
little  to  over-tiring  and  taking  the  fine  edge  from  their  executive 
capacity,  and  thus  reducing  the  efficiency  of  the  directive 
organization. 

Hours  of  Work  per  Day. — That  the  question  of  the  number  of 
hours  of  work  per  day  is  at  the  present  a  controversial  rather  than 
a  scientific  one,  is  easily  judged  from  the  divergent  practices  and 
demands  of  workers.  While  the  twelve  hour  day  still  persists  in 
some  continuous  process  industries,  the  ten  hour  day  is  retained 
by  others.  The  nine  hour  day  is  still  widely  used  in  many  plants; 


HOURS  AND  WORKING    PERIODS  69 

the  eight  hour  day  is  constantly  gaining  momentum  in  the  in- 
dustries where  labor  organization  had  not  heretofore  enforced  it. 
And  in  the  industries  where  labor  unions  are  strong  the  seven 
hour  day  is  in  certain  cases  an  actuality  and  the  six  hour  day  a 
demand. 

The  evidence  as  to  the  relation  of  hours  to  the  long-time  health 
and  efficiency  of  the  workers  is  by  no  means  completely  convinc- 
ing. But  it  tends  on  the  whole  to  show  that  under  present  condi- 
tions in  most  industries  an  eight  hour  day  results  in  a  high,  if 
not  the  highest,  productivity.  A  moderate  amount  of  leisure 
is  thus  obtained;  the  plant  is  in  operation  during  the  daylight 
hours  nearly  the  year  through;  the  weekly  output  in  well- 
managed  plants  appears  to  suffer  little  if  any  diminution  in  a 
reduction  from  nine  to  eight  total  working  hours. 

Maintaining  the  Output. — From  the  management  point  of 
view  the  effect  of  the  shortening  of  the  working  period  on  output, 
even  if  it  is  not  necessarily  the  only  determining  consideration, 
is  highly  important.  Nor  have  we  any  desire  to  slight  the  prob- 
lem, adhering  as  we  do  to  the  idea  that  the  professional  obliga- 
tions of  personnel  managers  are  in  the  direction  of  getting  needed 
production  as  cheaply  as  the  maintenance  of  human  industrial 
standards  will  permit.  But  so  much  stress  has  been  laid  upon 
the  fact  of  reduction  of  output  with  the  reduction  of  hours,  that 
it  is  essential  to  point  out  that  the  number  of  hours  worked  is 
only  one  of  a  whole  series  of  causes  which  affect  the  amount  of 
output,  and  in  nine  factories  out  of  ten  nearly  all  of  the  other 
factors  are  crying  out  for  correction.  The  whole  complex  of  factors 
at  the  root  of  factory  efficiency  is,  indeed,  so  infrequently  under- 
stood, analyzed  and  controlled  that  one  of  the  most  astute  of 
America's  mechanical  engineers  dares  to  be  quoted  as  saying  that 
"if  America  seriously  set  out  to  eliminate  all  the  friction  in  her 
industrial  system,  we  may  expect  a  four,  or  perhaps  a  two  hour 
day.  With  production  simplified  and  power  utilized  to  its  fullest 
capacity,  we  could  probably  produce  all  we  want  in  less  than  six 
hours."1  Even  allowing  for  a  degree  of  rhetoric  in  these  sen- 
tences from  a  sober  engineer,  they  point  a  moral  to  which  all  stu- 
dents of  the  science  of  management  can  at  once  subscribe.  In- 
deed, another  engineer  says  that  our  industry  runs  ordinarily  at 

1  POLAKOV,  WALTER  N.,  in  The  Great  Change  by  C.  W.  WOOD,  pp. 
100-111. 


70  PERSONNEL  ADMINISTRATION 

about  40  per  cent,  efficiency  because  of  incompctency  in  factory 
management. 

The  point  of  this  evidence  is  simply  to  show  that  efforts  of 
managers  to  defeat  proposals  for  shorter  work  periods  do  not 
necessarily  prove  that  their  introduction  would  be  calamitous. 
Managements  have  usually  found  themselves  able  by  better 
methods  to  cope  successfully  with  curtailments  in  working  times, 
which  were  at  first  decried  as  impossible.  Historically,  it  has 
probably  been  true  that  improvements  in  management  technique 
have  been  largely  enforced  by  the  pressure  of  competition  or  of 
labor  demands.  But  the  time  has  come  when  this  should  be  true 
no  longer.  Just  as  fast  as  the  science  of  management  is  under- 
stood to  involve  a  positive  and  productive  professional  service, 
reasonable  demands  for  reduced  hours  will  be  met  at  the  outset 
by  one  supremely  valuable  effort — by  the  aggressive  efforts  of 
managers  to  apply  science  to  the  whole  range  of  management  prob- 
lems. 

This  conception  of  management  as  a  profession,  standing  ready 
to  make  truly  scientific  the  application  of  human  energy  to  ma- 
terials, is  destined  as  it  extends  to  increase  surprisingly  the  poten- 
tial productivity  of  industry.  And  this  conception  should  be 
borne  in  mind  throughout  the  present  chapter;  otherwise  we  will 
be  thought  to  favor  a  reduction  in  hours  and  hence  in  output 
which  would  be  a  serious  loss.  We  do  indeed  favor  what  is  to- 
day considered  as  a  liberal  policy  regarding  hours.  But  we  are 
at  the  same  time  clear  that  any  possible  lessening  in  output  from 
shortened  work-periods  can  be  more  than  compensated  for  by 
various  improvements  which  managers  and  men  working  closely 
as  a  producing  unit  have  at  their  disposal. 

There  is,  to  be  sure,  a  point  in  every  industry  below  which  a 
reduction  of  hours  will  affect  output  adversely.  But  with  in- 
creasing recognition  not  alone  by  the  workers  but  by  all  students 
of  social  progress,  that  human  nature  must  have  a  chance  to 
express  itself  if  the  claims  of  parenthood,  citizenship,  and  of  in- 
dustry itself  arc  to  be  effectively  met,  efforts  to  reduce  hours 
promise  to  be  one  of  the  most  powerful  stimuli  to  lx>tter  manage- 
ment and  to  result,  therefore,  in  a  maximum  utilization  of  inter- 
est and  energy  during  working  hours. 

The  objection  is  frequently  urged,  however,  that  opposition  to 
shorter  hours  comes  from  workers  who  want  to  get  as  much  pay 
In  iinlivMiKil  in-t:tnri>.  tin-  i-  n«>  il<>ul»t  true.  1'ut 


HOURS  AND  WORKING  PERIODS  71 

the  point  which  deserves  consideration  is  the  usual  reason  for 
this  opposition,  rather  than  the  opposition  itself.  And  the  rea- 
son usually  lies  in  a  closely  related  problem — the  problem  of 
payment.  Reduction  in  hours  should,  of  course,  if  it  is  to  bring 
the  proper  benefits  to  both  sides,  be  accompanied  by  such  changes 
in  hourly  and  piece  rates  as  will  keep  the  income  of  the  worker 
at  least  equal  to  that  earned  under  the  longer  hours.  Under 
these  conditions  any  sporadic  opposition  of  workers  to  shortened 
hours,  tends  to  disappear. 

Hours  of  Work  per  Week. — In  practice  the  eight  hour  day 
results  in  a  44  hour  week  wherever  the  workers  are  strong  enough 
to  press  their  claim  for  the  Saturday  half-holiday.  Such  an 
arrangement  of  working  hours  is  gaining  wider  and  wider  accept- 
tance.  The  value  of  the  half-holiday  is  felt  to  be  great  wherever 
it  is  adopted,  since  it  provides  a  continuous  period  of  week-end 
respite  which  is  physiologically  and  socially  valuable. 

Indeed,  the  use  of  a  40  hour  week,  in  which  no  Saturday  work 
is  done,  but  work  runs  eight  hours  a  day  for  five  days,  is  gaining 
ground.  Originally  adopted  in  some  corporations  as  a  summer 
policy,  its  adoption  as  a  year-round  measure  is  now  being  seri- 
ously urged. 

A  similar  practice  in  use  in  one  or  two  plants  is  to  retain  an 
approximately  48  hour  week  but  to  put  all  the  work  into  five 
days.  The  benefits  of  a  two  day  holiday  to  management  and 
men  alike  are  recognized.  Machine  and  plant  maintenance  is 
better  handled  under  this  arrangement;  less  heat  is  required;  the 
short  and  relatively  unproductive  Saturday  is  eliminated;  the 
workers  are  able  to  have  gardens  and  do  more  work  for  them- 
selves around  the  house. 

The  Six  Hour  Day. — The  movement  for  a  six  hour  day  began 
in  earnest  in  this  country  with  its  endorsement  by  the  American 
Federation  of  Labor  at  its  1919  convention.  In  England  this 
shorter  day  has  already  been  advocated  by  a  prominent  soap 
manufacturer.  He  has  said: 

-"Under  the  present  system  of  hours  of  work  the  thorough  education 
of  our  children  is  practically  impossible.  An  absolutely  essential  step 
in  the  direction  of  a  more  efficient  educational  system  is  the  shortening 
of  the  hours  of  labor  and  the  improving  of  the  conditions  of  living  for  the 
worker. 

"We  are  only  just  beginning  to  make  a  considered  study  of  the  ineffi- 
ciency and  resulting  waste  that  is  produced  by  fatigue.  We  can  not 


72  PERSONNEL  ADMINISTRATION 

claim  even  yet  that  we  have  any  very  profound  knowledge  on  the  sub- 
ject, but  the  wastefulness  of  fatigue  has  been  abundantly  proved  by  the 
researches  already  made.  Therefore  it  is  essential  that  work  in  tho 
factory,  the  workshop  and  the  office  should  be  so  arranged  as  to  avoid 
fatiguo,  and  by  maintaining  the  general  health  of  the  workers,  to  pro- 
long their  activity  and  increase  their  skill  and  efficiency. 

"Moreover,  modern  conditions  of  production  requiring  costly  plant, 
machinery,  and  factory  buildings  make  it  obvious  that  such  division  of 
the  24  hours  must  be  made  as  will  (whilst  utilizing  the  mechanical  utili- 
ties to  their  utmost  capacity  so  as  to  get  as  large  an  output  from  plant, 
machinery,  and  mechanical  utilities  as  possible)  tend  to  relieve  the  hu- 
man element  from  fatigue.  Only  by  so  doing  can  we  reduce  to  a  mini- 
mum all  overhead  charges  for  interest,  depreciation,  and  rent,  etc. 

"It  is  obvious  from  the  above  that  when  our  modern  industries  are 
run  on  a  less  fatiguing  system  of  say  two  shifts  each  of  six  and  a  half 
hours  with  half  an  hour  off  for  meals  (making  six  working  hours  in  all  per 
day),  the  efficiency  of  the  worker  by  thus  avoiding  fatigue  can  be  in- 
creased by  at  least  33  per  cent.,  and  consequently  that  as  much  work  can 
readily  be  done  in  six  working  hours  as  under  present  conditions  is  done 
in  eight.  But  in  addition  to  the  ability  of  the  employee  to  produce  as 
big  an  output  in  six  hours  as  is  now  produced  in  eight,  there  would  be 
the  added  advantage  that  the  plant,  machinery,  etc.,  would  be  running 
for  50  per  cent.,  longer  time,  viz.,  12  hours  instead  of  eight,  which  running 
of  machinery  would  reduce  the  overhead  charges  proportionately  and 
increase  the  output  enormously."1 

Nor  is  Lord  Lever  hulme  without  supporters  in  this  country. 
Mr.  Polakov  said  in  the  previously  quoted  interview, 

"The  ten  hour  day  has  generally  given  way  to  the  eight;  and  there 
is  every  reason  to  believe  that  the  six  hour  day  will  soon  prove  still  more 
economical." 

The  arguments  for  what  may  seem  at  first  to  be  a  drastic 
change  deserve  careful  examination.  Lord  Leverhulme  speaks, 
of  course,  from  the  point  of  view  of  a  continuous  industry  (soap- 
manufacturing)  when  he  says: 

"  We  must  have  a  six-hour  working  day  for  men  and  women  and  by 
means  of  six-hour  shifts  we  must  work  our  machinery  twelve,  eighteen  or 
even  twenty-four  hours."* 

1  Industrial  Health  and  Efficiency.  Reprint  of  Final  Report  of  British 
Health  of  Munition  Workers'  Committee,  Bulletin  of  U.  S.  Bureau  of  I^abor 
Statistics,  No.  240,  p.  83. 

*LoRD  1. 1. \  Linn  i. \u:.  The  Six-Hour  Day  and  Other  Industrial  Ques- 
tions, p.  16.  For  a  careful  statement  by  him  to  his  board  of  directors  as 
to  the  arrangement  of  hours  under  the  six-hour  shifts,  see  Monthly  Labor 
Review,  U.  8.  Bureau  of  Labor  Statistics,  v.  9,  p.  160-1,  July,  1919. 


HOURS  AND  WORKING  PERIODS  73 

But  even  the  use  of  two  shifts  of  six  hours  would  mean  a  50 
per  cent,  greater  utilization  of  plant  than  is  now  secured  on  the 
eight  hour  day.  This  means  reduced  overhead  and  fixed  charges. 
And  the  educational  opportunities  which  would  open  to  all 
workers  with  the  reduced  period  of  labor,  would  reflect  both  in 
the  efficiency  of  factory  operation  and  in  the  quality  of  personal- 
ity which  would  be  fostered.  Finally,  the  consuming  power  of 
people  increases  both  in  range  and  taste  as  they  have  the  leisure 
to  enjoy  the  good  things  of  life,  and  this  in  turn  acts  to  stimulate 
a  healthy  increase  in  the  demand  for  worth-while  articles. 

This  is  not  said  by  way  of  advocacy  of  immediate  adoption 
of  the  six  hour  day.  It  is  said  simply  in  explanation  of  the  possi- 
ble values  of  a  movement  which  while  it  may  be  widely  opposed 
as  "economically  unsound"  or  "impossible,"  should  yet  be 
understood  as  the  sober  business  proposal  of  a  successful  manu- 
facturer who  has  had  the  temerity  to  urge  his  board  of  directors 
to  let  him  practice  what  he  preaches,  in  his  own  plant. 

Overtime  Work. — The  evils  of  a  policy  which  deliberately 
encourages  overtime  work  are  grave.  The  fact  of  overtime  tends 
to  lessen  the  working  pace  in  the  normal  hours;  it  increases 
fatigue  and  thus  tends  to  emphasize  all  the  consequences  of 
fatigue — irregular  attendance,  sickness,  physical  debility.  It 
tends,  when  long  pursued,  to  increase  labor  turnover  and  to 
stimulate  unrest. 

There  should,  consequently,  be  a  defined  limit  to  the  number 
of  overtime  hours  of  work  per  day  and  per  week.  Certain 
carefully  drawn  collective  agreements  already  contain  clauses 
regulating  overtime,  and  there  is  good  reason  for  including  such 
provisions  in  all  labor  contracts.  One  recent  agreement  says, 
for  example,  that  "overtime  work  shall  be  limited  to  six  hours 
in  any  one  week  and  one  and  one-half  hours  in  any  one  day."1 
The  reason  for  allowing  this  rather  wide  margin  lies  in  the  fact 
of  the  seasonality  of  the  industry  in  question. 

Night  Work. — Night  work  has  normally  no  justification  out- 
side of  the  essentially  continuous  industries.  In  these  cases 
the  tendency  is  all  in  the  direction  of  three  8  hour  shifts,  which 

1  Agreement  in  Dress  and  Waist  Industry  in  New  York  City  as  quoted  in 
the  Monthly  Labor  Review,  U.  S.  Bureau  of  Labor  Statistics,  v.  8,  p.  1559-60, 
June,  1919.  The  justification  for  "time-and-a-half"  or  double  pay  is  in  the 
effectiveness  of  the  penalty  it  presents  against  excessive  overtime  work.' 


74  PERSONNEL  ADMINISTRATION 

reduces  somewhat  the  hardships  involved.  It  may  possibly 
be  true  that  the  deleterious  effects  of  night  work  can  be  further 
lessened  by  rotating  the  workers  on  the  several  shifts  at  some 
agreed  interval.  But  although  this  would  distribute  the  night 
work  over  the  entire  force  and  give  to  all  a  reasonable  amount  of 
time  in  which  the  normal  hours  of  work,  play  and  sleep  can  be 
observed,  it  does  involve  a  periodic  readjustment  of  living  habits 
which  is  found  in  practice  to  be  very  taxing. 

In  non-continuous  industries  night  work  is  in  the  long  run  bad 
business.  It  is  hard  to  fill  the  night  shift;  it  is  difficult  to  main- 
tain the  output  at  the  expected  quantity  and  quality;  it  is  hard 
to  provide  a  competent  administrative  organization.  "Even 
for  men, "  says  an  official  English  study  published  during  the  war 
for  adoption  as  war-time  policy,  "night  work  is  open  to  serious 
objection.  It  is  uneconomical  owing  to  higher  charges  for  wages, 
lighting  and  heating.  Lighting  is  generally  inferior  and  super- 
vision more  difficult.  Adequate  sleep  by  day  is  difficult,  owing 
to  dislocation  of  ordinary  habits  or  from  social  causes.  Social 
intercourse  and  recreation  can  hardly  be  obtained  except  by  un- 
due curtailment  of  sleep.  Continuance  of  education  is  generally 
impracticable.  Finally  it  is  unnatural  to  turn  night  into  day."1 

The  physiological  objections  to  night  work  should  be  kept  clearly 
in  mind.  It  is  the  usual  testimony  that  under  night  work(l) 
the  worker  gets  less  sleep  than  he  needs; (2)  he  works  least  effec- 
tively in  the  early  morning  hours — three  to  five  A.M. — because 
the  bodily  vitality  is  then  at  its  lowest  point  in  the  entire  24 
hours;  (3)  the  lunch  period  is  usually  short  and  the  factory 
facilities  for  providing  a  hot  lunch  are  usually  not  operating 
during  the  night;  (4)  little  work  is  done  during  the  last  hour  of 
the  night  shift  in  the  cases  where  the  shift  is  over  eight  hours 
long. 

Sunday  Work. — The  commandment  that  on  six  days  man  and 
his  helpers  shall  labor  but  on  the  seventh  day  they  should  rest, 
has  its  sound  foundation  in  human  physiology.  The  English 
war  studies  of  hours  and  output  state  their  conclusions  clearly 
as  follows: 

"At  the  commencement  of  the  War  Sunday  labor,  especially 
for  men,  was  widely  adopted  in  the  hope  of  increasing  output. 
The  evidence,  however,  proves  conclusively  that  Sunday  labor 
is  unpopular,  uneconomical,  and  not  productive  of  increased 

1  Industrial  Health  and  Efficiency,  op.  rit.,  p.  255. 


HOURS  AND  WORKING  PERIODS  75 

output Where  Sunday  labor  becomes  necessary,  arrange- 
ments should  be  made  by  a  system  of  relief  shifts  that  no 
individual  worker  is  employed  more  than  six  days  in  the 
week."1 

The  demands  of  civilization  for  continuous  service  in  hotels 
and  restaurants,  transportation  and  telephone  lines,  the  pur- 
veying of  news,  perishable  food  products,  etc.,  make  Sunday 
work  today  a  necessity  for  hundreds  of  thousands  of  workers. 
In  some  companies  this  condition  is  met  by  one  day  of  rest  in 
fifteen.  This  is  an  unsatisfactory  expedient  for  the  worker  and 
it  does  not  meet  the  physiological  demand  for  regular  periods 
of  rest.  Employers  in  these  industries  as  well  as  consumers  must 
come  to  realize  that  the  wage  charge  for  a  large  enough  staff  of 
workers  so  that  each  one  can  have  at  least  one  full  day  off  in  seven, 
is  a  proper  and  economical  part  of  the  operating  cost. 

Holidays/ — Saturday  half  holidays  are  being  constantly 
extended;  and  at  least  during  the  four  summer  months,  are  widely 
granted.  All  day  Saturday,  especially  during  the  summer,  is 
given  off  without  pay  in  some  stores  and  a  few  factories. 

In  written  collective  bargains  the  public  holidays  which  are 
to  be  observed  are  usually  named.  This  is  by  far  the  most  satis- 
factory policy  since  otherwise  it  often  happens  that  the  granting 
of  holidays  depends  upon  the  amount  of  business  in  prospect  and 
no  decision  is  reached  until  a  few  days  before  the  holiday.  It 
is  now  true  in  most  of  the  Eastern  states,  that  a  state  or  national 
holiday  is  observed  in  each  of  ten  or  eleven  months  of  the  year. 
The  adoption  of  this  one  day  off  a  month  (especially  where  it  can 
be  added  into  the  week-end  period)  is  desirable  from  the  human 
and  production  points  of  view.  "The  workers,  refreshed  and 
more  vigorous,  unconsciously  start  work  on  a  higher  level  of 
speed  and  maintain  that  level  permanently,  whereas  a  reduction 
of  hours  unaccompanied  by  a  holiday,  i.  e.,  by  a  chance  of  break- 
ing through  settled  habits  of  work,  is  generally  very  much  slower 
in  conducing  to  the  desired  reaction."2  And  in  the  same  report 
there  is  the  following  valuable  sentence.  "The  committees 
desire  especially  to  emphasize  the  need  for  giving  periodic  holi- 
days to  members  of  the  management  and  to  foremen.  They 
cannot  take  odd  days  off  like  the  ordinary  worker,  and  cases  of 
temporary  breakdown  have  been  regrettably  common."  An 

1  Industrial  Health  and  Efficiency,  op.  cit.,  p.  255. 
1  Industrial  Health  and  Efficiency,  op,  cit.,  p.  91. 


76  PERSONNEL  ADMINISTRATION 

observance  of  all  the  legal  holidays  thus  has  its  benefits  for  man- 
agement as  well  as  for  manual  workers. 

Vacations. — The  granting  of  a  regular  annual  vacation  with 
pay  to  manual  workers  is  still  the  rare  exception.  Many  com- 
panies give  vacations  to  salaried  workers;  but  managerial  think- 
ing about  the  condition  of  wage  earners  has  not  been  sufficiently 
in  scientific  and  physiological  terms  to  bring  the  annual  rest 
period  into  wide  use.  A  liberal  vacation  policy  does,  of  course, 
presuppose  a  fairly  stable  working  force  in  which  the  labor  turn- 
over is  small  and  confined  to  a  small  per  cent,  of  the  workers; 
and  such  a  condition  of  stability  has  not  in  the  past  been  a  fre- 
quent characteristic  of  American  industries.  But  as  more  and 
more  plants  take  steps  to  reduce  turnover  and  to  create  a  perma- 
nent body  of  workers  animated  by  goodwill,  the  problem  of  va- 
cations will  demand  definite  attention. 

It  is,  indeed,  probably  true  that  the  need  for  a  complete  rest 
from  industrial  work  for  at  least  two  weeks  a  year  grows 
greater  as  time  goes  on.  The  strain  of  industrial  life,  created 
by  a  combination  of  nervous  anxiety  about  work  and  liveli- 
hood, speed  of  work,  noise,  and  repetition  of  work  at  jobs  in 
which  the  worker  finds  little  to  interest  him, — this  strain  must 
be  off-set  if  there  is  not  to  be  a  progressive  deterioration  of 
vitality  and  of  personality.  The  physiological  reasons  for  annual 
vacations,  growing  out  of  industrial  conditions  distinctly  un- 
favorable to  the  human  nervous  system,  are  therefore  cogent. 

Some  firms  have  used  vacations  as  a  reward  for  regular  attend- 
ance or  some  other  "good  behavior;"  others  vary  the  length  of 
the  vacation  with  the  length  of  service.  Still  others  shut  down 
the  plant  for  ten  days  or  two  weeks  in  a  period  including  the 
Fourth  of  July  or  Labor  Day,  and  overhaul  machinery  or  take 
stock.  Concerns  in  this  last  group  do  not  usually,  of  course, 
pay  wages  during  the  shut-down.  And  there  is  a  final  condition 
of  self-determined  vacations  which  is  usually  more  prevalent  in 
small-town  plants  than  in  city  factories.  Often  the  workers 
leave  for  the  summer  to  work  on  the  farms  or  at  summer  hotels. 
This  change  of  work  may  be  quite  as  beneficial  from  a  physiological 
point  of  view  as  a  complete  rest;  but  there  is,  of  course,  no 
certainty  of  re-employment,  and  the  factory  is  meanwhile  in  a 
most  uncertain  state  about  its  summer  labor  supply. 

A  deliberate  vacation  policy  for  all  workers  who  have  been 
with  the  company  a  year  seems  to  us  the  highly  desirable  stand- 


HOURS  AND  WORKING  PERIODS  77 

ard  practice.  This  holiday  should  be  with  pay — with  the  pay- 
ment in  advance  of  at  least  half  the  vacation  salary,  in  order  that 
the  worker  may  finance  a  real  change  of  location, — the  rest  of 
the  pay  to  be  given  when  he  returns. 

Two  weeks  is  the  minimum  period  in  which  any  thorough 
physical  recuperation  can  take  place;  and  a  longer  time  would  be 
preferable.  It  will  therefore  be  desirable  to  grant  employees 
who  have  been  in  service  longer  than  two  or  three  years,  a  longer 
holiday.  But  to  make  any  vacation  a  contingent  of  "good 
behavior,"  is  like  making  sleep  or  three  meals  a  day  a  reward; 
in  reality  all  are  demanded  by  the  dictates  of  sound  hygiene. 
The  Federal  government's  policy  of  a  month's  vacation  a  year, 
which  applies  to  all  its  manual  workers  in  the  civil  service,  may 
seem  at  present  to  be  a  policy  of  undue  liberality ;  yet  it  is  an  en- 
lightened and  human  policy  which  reflects  in  improved  health, 
work  and  goodwill  throughout  the  year. 

Objection  may  fairly  be  urged  that  some  workers  will  not  know 
how  to  use  a  vacation;  that  they  will  simply  sit  around  their 
own  homes  and  get  no  really  beneficial  change.  This  is  likely 
to  be  all  too  true  where  the  vacation  habit  is  not  formed,  unless 
some  conscious  effort  is  made  to  get  the  employee  interested  in 
an  outing.  Leisure,  like  money,  it  should  be  remembered,  is 
something  that  one  who  is  customarily  without  it,  has  to  learn 
how  to  use  wisely.  And  in  addition  to  not  having  resources 
in  pleasant  avocations,  many  manual  workers  have  not  the 
savings  on  which  to  draw  to  pay  for  a  trip  for  themselves  and 
families  and  they  do  not  know  where  to  go. 

The  company  which  sees  the  human  benefits  of  an  established 
vacation  policy  for  all  employees,  should  at  least  during  the  first 
few  years  of  the  adoption  of  the  policy,  help  its  employees  by 
encouraging  savings  and  by  maintaining  (or  cooperating  in  the 
operation  of)  a  vacation  bureau  which  will  know  all  about  fares, 
boarding  houses,  camping  facilities,  and  prices  at  the  available 
country  or  seaside  resorts.  There  is  a  degree  of  inertia  to  be 
overcome  in  getting  the  family  or  individual  who  is  unaccustomed 
to  a  vacation  to  go  to  the  country  or  shore,  which  should  be  fully 
reckoned  with  in  advance,  but  which  it  is  well  worth  the  effort 
to  overcome. 

Length  of  Working  Periods. — The  adoption  of  the  eight  hour 
day  usually  solves  automatically  the  difficulty  of  the  too-long 
working  period,  since  four  hours  of  work  are  done  in  the  morning 


78  PERSONNEL  ADMINISTRATION 

and  four  in  the  afternoon.  It  is  now  fairly  well  established  that 
five  hours  of  uninterrupted  work  is  too  long  a  period  in  which  to 
try  to  sustain  production  at  the  maximum. l  The  four  hour  period 
is  more  justifiable.  Yet  every  industry  and  every  job  requires 
study  to  see  what  from  the  production  standpoint  is  the  best 
length  of  uninterrupted  work  period.  Indeed,  there  is  reason 
to  believe  that  frequently  even  four  hours  is  much  too  long  a 
period,  and  that  short  pauses,  or  rest  periods,  can  profitably  be 
introduced  at  various  points  within  this  time. 

The  Noon  Hour. — In  addition  to  bringing  the  benefit  of  a  short- 
ened work  period,  the  eight  hour  day  has  also  tended  to  increase 
the  doubtfully  hygienic  practice  of  the  half-hour  lunch  period. 
It  is  true  that  workers  are  often  anxious  to  eat  quickly  in  order 
to  have  the  working  day  finish  as  early  as  possible.  But  there 
are  physiological  factors  which  out  of  consideration  for  the  long- 
time well-being  of  the  workers,  should  be  given  weight.  It  is 
clearly  impossible  for  the  human  stomach  to  bring  the  amount  of 
food  which  should  be  taken  at  the  noon  meal  to  a  state  of  suffi- 
cient digestion  in  thirty  minutes,  to  make  it  healthful  for  the 
worker  to  return  at  once  to  work,  for  that  will  draw  the  blood  sup- 
ply from  the  stomach  where  it  is  needed  to  further  the  processes 
of  digestion.  Forty-five  minutes  is  the  shortest  time  which  should 
be  taken;  the  unhealthy  tendency  today  to  eat  rapidly  is  suffi- 
ciently wide-spread  to  need  no  such  encouragement  as  the  half- 
hour  lunch  interval  brings.  Ideally,  a  full  thirty  minutes  should 
be  given  to  eating  and  thirty  minutes  more  to  quiet  relaxation. 
And  it  will  usually  be  found  true  that  if  workers  have  some  place 
to  go  besides  the  shop  door-step  and  something  to  do  besides  sit  on 
uncomfortable  benches,  they  will  be  less  reluctant  to  give  45 
or  60  minutes  to  the  noon  recess.  The  stomach,  it  should  be 
remembered,  is  a  vital  part  of  the  "physico-chemical  engine" 
which  can  be  prematurely  worn  out  and  put  temporarily  out  of 
business  by  overwork  under  improper  conditions.  To  require 
it  to  start  its  digestive  work  while  the  body  is  otherwise  engaged 
upon  physical  labors,  is  an  unnatural  and  too  severe  demand. 

Decision  about  the  actual  lunch  hour  policy  in  any  given 
plant,  must  be  made  with  its  local  conditions  in  view.  If, 
however,  there  are  not  convenient  and  adequate  lunch  rooms,  or 
if  the  workers  are  eating  in  the  shop  with  nowhere  to  go  after 

1  Sec  Industrial  Health  and  Efficiency,  op.  cil.,  p.  90. 


HOURS  AND  WORKING  PERIODS  79 

disposing  of  their  little  packet  of  lunch,  there  is  some  reason  in 
their  demand  to  get  to  work  again  and  get  away. 

Rest  Periods. — A  rest  period  is  a  regular,  concerted  and 
required  pause  in  the  work  activity.  The  purpose  of  its  intro- 
duction is  to  preserve  the  efficiency  of  the  workers  "through  re- 
duction of  temporary  fatigue  and  prevention  of  cumulative 
fatigue."1  Industry  already  is  not  without  a  fair  amount  of  ex- 
perience with  rest  periods;  and  they  are  found  to  be  most  clearly 
of  advantage  in  the  following  types  of  work: 

"Occupations  monotonous  in  character  or  requiring  prolonged  and 
intense  concentration  of  attention. 

"Occupations  enforcing  either  a  continuous  sitting  or  a  continuous 
standing  posture. 

"Occupations  involving  severe  physical  exertion. 

"Occupations  exposing  the  workers  to  extreme  heat  or  gases  or  other 
unfavorable  ventilating  arrangements."2 

It  has  frequently  been  true  that  rest  periods  have  been  intro- 
duced and  continued  because,  as  one  manager  puts  it,  it  is  "com- 
mon sense." 

"We  believe,"  he  added,  "that  it  is  self-evident  that  a  few  minutes  in 
the  middle  of  the  morning  and  in  the  middle  of  the  afternoon  devoted  to 
relaxation  and  to  exercises,  which  will  straighten  out  the  cramped 
bones  and  muscles  of  workers  have  beneficial  results  in  everyway."3 

More  reasoned  arguments  have  also  been  advanced  by  em- 
ployers who  have  studied  the  results  of  this  policy  closely.  It 
is  claimed,  for  example,  that  rest  periods  show  a  beneficial 
effect  on  quantity  and  quality  of  work  done.  Quantity  may  be 
increased  because  of  a  spurt  immediately  preceding  or  follow- 
ing the  rest  period,  or  because  of  the  greater  energy  which  it  is 
possible  to  summon  throughout  the  working  period.  "I  con- 
sider rest  periods  at  certain  times  of  the  day  as  absolutely 
necessary  to  secure  a  reasonable  amount  of  human  effort  from 
the  individual  worker,"  says  one  employment  manager.  "We 
find  that  we  can  do  more  and  better  work  with  fewer  employees 
by  this  method."4  "A  10-minute  break  in  the  middle  of  the 

1  See   Rest    Periods  for    Industrial    Workers,  Research    Report    No.    13 
of  the  National  Industrial  Conference  Board,  Boston,   1919.     We  are  in- 
debted to  this  study  for  much  of  the  matter  in  this  section. 

2  Rest  Periods  for  Industrial  Workers,  op.  tit.,  p.  9. 

3  Rest  Periods  for  Industrial  Workers,  op.  cit.,  p.  43. 

4  Rest  Periods  for  Industrial  Workers,  op.  cit.,  p.  20. 


80  PERSONNEL  ADMINISTRATION 

morning  and  afternoon  spells,  during  which  the  operatives  re- 
main at  their  machines,  but  take  tea  or  other  nutriment  brought 
them  by  boys  or  by  traveling  canteens,  has  been  found  a  valu- 
able aid  to  output  in  some  munition  plants."1 

Quality,  likewise,  may  be  improved  because  the  worker's 
powers  of  attention,  perception  and  manipulation  are  kept 
keen  through  an  occasional  rest. 

"That  a  brief  rest  would  be  conducive  to  better  work  in  occupations 
involving  such  concentration  as  proof  reading  or  bookkeeping  or  close 
inspective  seems  almost  self-evident."1 

The  length  of  the  rest  intervals  and  the  distribution  of  them 
through  the  working  hours,  are  clearly  subject  for  experi- 
mentation. Several  studies  indicate  that  short  rest  periods 
of  five  minutes  scattered  through  the  day  affect  output  most 
helpfully.3 

"For  work  in  which  severe  muscul.-ir  effort  is  required  it  seems  prob- 
able that  the  maximum  output  over  the  day's  work  and  the  best  condi- 
tions for  the  workers'  comfort  and  maintained  health  will  be  secured  by 
giving  short  spells  of  strenuous  activity  broken  by  longer  spells  of  rest, 
the  time  ratio  of  rest  to  action  being  here,  for  maximal  efficiency, 
greater  than  that  for  the  employments  in  which  nervous  activity  is  more 
prominent  or  more  complicated  than  in  the  processes  involved  during 
familiar  muscular  work."4 

On  the  other  hand,  the  usual  practice  where  work  is  less 
arduous,  is  a  period  in  the  middle  of  the  morning  of  ten  or 
fifteen  minutes;  and  a  similar  respite  in  the  middle  of  the 
afternoon. 

Questions  often  arise  about  the  use  of  this  interval.  Some 
plants  leave  the  workers  to  themselves  and  it  is  understood 
that  they  shall  use  the  time  to  get  drinking  water,  walk  around, 
and  use  the  toilets.  Other  plants  where  the  work  is  sedentary 
have  setting-up  exercises  for  five  minutes;  selected  workers  are 
trained  in  the  setting-up  drill  and  they  lead  the  drill  in  their  own 
departments.  Windows  are  opened  and  everyone  is  encouraged 
to  get  the  most  complete  possible  physical  change.  Other 
plants  encourage  the  taking  of  a  small  lunch  at  this  time.  Pro- 

1  Industrial  Health  and  Efficiency,  op.  <•//..  p.  90. 
1  Rest  Periods  for  Industrial  Workers,  op.  til.,  p.  25. 
*  JONES,   E.   D.     Administration    of    Industrial    Enterprises,    1010,  pp. 
221-2. 

4  Industrial  Health  and  Efficiency,  op.  oil.,  p.  37. 


HOURS  AND  WORKING  PERIODS  81 

vided  that  wholesome  food  like  milk,  sweet  chocolate  or  sand- 
wiches, is  taken,  this  is  sound  practice  and  should  be  encouraged 
especially  in  the  morning  interval  when  many  workers  have  taken 
a  breakfast  inadequate  to  energize  them  until  noon. 

The  important  principle  to  apply  is  that  the  workers  should 
be.  encouraged  to  do  something  in  the  rest  period  which  brings 
a  real  change  in  position,  movement  and  blood  pressure. 

The  administration  of  rest  periods  is  not,  however,  without  its 
difficulties.  Some  employers  object  that  there  are  types  of  work 
at  which  the  worker  can  normally  rest  between  the  times  when 
the  job  requires  attention.  Whether  this  is  true  or  not  is  easily 
established  by  job  analysis;  and  where  it  is  true,  the  objection 
certainly  has  force.  At  other  types  of  work  it  is  claimed  that 
the  period  of  rest  would  naturally  follow  the  completion  of 
certain  parts  of  the  process  which  occurs  at  irregular  times,  and 
that  it  has  necessarily  to  be  intermittent.  Where  this  is  the 
case,  obviously  the  time  of  rest  should  be  accommodated  to  the 
nature  of  the  work. 

Certain  objections  that  may  arise  at  the  installation  of  rest 
periods  depend  for  their  satisfactory  handling  largely  upon  the 
management's  attitude  and  the  shop  morale.  For  example, 
workers  may  prefer  to  have  no  rest  periods  but  a  shorter  working 
day.  This  is  a  natural  position  even  if  the  day  is  eight  hours  long 
or  less.  But  it  is  an  objection  that  the  management  can  usually 
meet  with  ease  if  it  is  in  the  habit  of  conferring  with  its  workers 
in  the  manner  described  in  the  chapters  on  job  analysis  and  shop 
committees.  Again,  there  may  be  danger  that  at  first  it  will 
take  the  shop  a  long  time  to  "settle  down"  after  the  period  is 
over;  or  that  the  machine  or  material  has  again  to  be  made 
ready  to  use  when  the  worker  returns  after  an  interruption  of 
the  process.  Neither  of  these  difficulties,  however,  prove  im- 
possible to  meet  where  managers  are  consciously  developing  a 
sense  of  shop  responsibility  and  goodwill.  Under  special  manu- 
facturing conditions  rest  periods  can  be  dovetailed  or  taken  by 
groups  in  rotation.  There  is  also  the  piece  worker's  possible 
objection — occasioned  if  output  and  therefore  earnings  are  even 
slightly  reduced  when  rest  periods  are  introduced.  If  it  does  in 
some  cases  prove  true  that  the  earnings  of  piece  workers 
suffer  a  permanent  reduction,  this  situation  might  be  met  by 
such  alteration  of  the  rates  as  will  give  the  worker  as  much  as 
he  earned  before. 

6 


82  PERSONNEL  ADMINISTRATION 

The  usual  purpose  in  introducing  rest  periods  is,  of  course,  to 
reduce  fatigue  and  increase  output.  Scientific  determination  of 
the  results  of  work  on  the  worker  and  on  output  require,  however, 
intensive  study  of  each  job  and  scientific  study  of  the  results  of 
fatigue.  A  careful  introduction  of  rest  periods  involves  an 
ability  to  make  proper  job  analysis  and  fatigue  measurements.. 

In  conclusion  we  may  safely  say  that  the  use  of  rest  periods 
even  when  no  positive  effect  on  output  is  demonstrable,  is  a 
commendable  and  physiologically  wise  precaution  at  most  jobs. 
As  to  the  length  and  distribution  of  the  periods,  however,  it  is 
impossible  to  generalize. 

Hours  and  Working  Periods  for  Women  Workers  and  Chil- 
dren.— Consideration  for  the  health  and  integrity  of  the  race  has 
led  to  the  gradual  adoption  of  legislative  restrictions  upon  the 
working  hours  of  women  and  children,  which  do  not  apply  to 
men.  It  is  not  our  purpose  here  to  recite  what  those  restric- 
tions are  in  detail  or  what  specific  regulations  each  state  has.  It 
is  important  to  understand,  however,  that  the  enlightened  con- 
science of  the  community  has  reached  a  stage  where  the  following 
standards  are  regarded  as  essential. 

There  should  be  no  night  work  for  women,  or  for  children 
(under  16  years  of  age) ;  that  is,  work  after  ten  in  the  evening  or 
before  six  in  the  morning. 

There  should  be  no  more  than  forty-eight  hours  of  work  per 
week  for  women  and  children;  and  less  is  desirable.  This  maxi- 
mum figure  should  be  inclusive  of  all  overtime. 

There  should  be  no  more  than  eight  hours  of  work  a  day 
for  women  and  children;  and  less  is  desirable. 

There  should  usually  be  a  full  hour  off  at  noon. 

There  should  be  a  rest  period  of  at  least  ten  minutes  in  the 
middle  of  the  morning  and  the  afternoon. 

Pregnant  women  should  not  be  employed  for  at  least  eight 
weeks  preceding  and  following  childbirth. 

For  all  women  and  girl  workers,  one  day  a  month  might  well  be 
allowed  off  with  pay;  the  day  to  be  taken  at  the  worker's  dis- 
cretion. 

Conclusion. — The  conclusion  to  which  our  consideration  of 
hours  leads  is  that  since  this  is  a  subject  upon  which  actual  prac- 
tices aie  necessarily  dictated  by  a  combination  of  scientific  data 
and  human  desires,  those  practices  will  be  most  amicably  deter- 
mined and  effectively  put  into  operation  if  they  are  made  the  sub- 


HOURS  AND  WORKING  PERIODS  83 

ject  of  determination  by  managers  and  workers  in  conferences. 
There  are  maximum  hours  and  working  periods  which  it  is 
clearly  inexpedient  to  exceed.  There  are  certain  off -times  which 
it  is  clearly  expedient  to  introduce.  But  experiments  are  needed 
to  determine  the  best  possible  relation  between  length  and  in- 
tensity of  operations  and  high  output. 

Finally,  employers  should  realize  that  the  human  demand  for 
shortened  hours  challenges  their  managerial  ability  as  it  never 
has  been  challenged  before.  It  gives  a  new  reason  for  intensive 
effort  also  to  the  workers.  But  managers,  especially,  will  re- 
quire a  firm  intellectual  grasp  and  control  of  all  the  other  ele- 
ments, besides  the  time  of  the  workers  at  the  bench  and  machine, 
which  contribute  to  productivity.  And  once  the  real  roots  of 
efficiency  are  tapped  there  is  good  reason  to  believe  that  the 
working  time  can  be  safely  confined  within  reasonable,  healthful 
and  enjoyable  limits.  Civilization  can  then  begin  to  refute  the 
melancholy  observation  of  John  Stuart  Mill  that  it  was  doubtful 
whether  the  introduction  of  machinery  had  in  any  way  lightened 
the  burdens  of  mankind. 

Selected  References 

COLE,  G.  D.  H.     Hours  Movement  in  England.     (In  New  Republic,  v.  18> 

pp.  247-249,  March  22,  1919.) 
GOLDMARK,  JOSEPHINE.     New  Strain  in  Industry.     (In  her  Fatigue  and 

Efficiency,  1913,  pp.  43-89). 
GREAT  BRITAIN  MINISTRY  OF  MUNITIONS.     Health  of   Munitions  Workers 

Committee.     Industrial  Health  and  Efficiency.     Final  Report  of  the 

British    Health    of    Munitions    Workers'    Committee.     Wash.    Govt. 

Printing  Office,  1919.     (U.  S.  Bureau  of  Labor  Statistics  Bui.  249.) 
LEVERHULME,  W.  H.  L.     Six-Hour  Day.     (In  his  Six-Hour  Day  and  Other 

Industrial  Questions,  pp.  14-35.)     N.  Y.,  1919.     Holt  &  Co. 
NATIONAL  INDUSTRIAL  CONFERENCE    BOARD.     Eight-Hour    Day    Defined. 

Boston,  pub.  by  Board,  1918.     (Research  Report  No.  11.) 
NATIONAL  INDUSTRIAL  CONFERENCE  BOARD.     Rest  Periods  for   Industrial 

Workers.     Boston,  pub.  by  Board,  1919.     Research  Report  No.  13. 
NEW  YORK  (STATE)  COURT  OF  APPEALS.     Case  Against  Night  Work  for 

Women.      Rev.  with  new  introduction  to   Mar.   1,    1918.      Prepared 

Apr.,    1914,   by  L.    D.    Brandeis   and    Josephine   Goldmark.     N.    Y., 

National  Consumers'  League,  1918. 
U.  S.   BUREAU  OF  LABOR  STATISTICS.     Welfare  Work  for   Employees   in 

Industrial  Establishments  in  the  United  States.     Wash.  Govt.  Printing 

Office,  1919.     (Bui.    250.) 


CHAPTER  VIII 
THE  HEALTH  OF  THE  WORKER 

Bodily  integrity  is  the  foundation  of  economic  and  social 
efficiency.  It  is  the  basis  of  health  in  mind,  body  and  spirit. 
Without  that  integrity  the  wholeness  and  wholesomeness  of  the 
individual  is  impaired.  With  it,  the  groundwork  is  laid  for 
individual  competence  and  industrial  efficiency.  Health  is  thus 
obviously  at  the  root  of  productivity  and  of  cordial  industrial 
relations. 

"The  idea  is  rapidly  growing  that  of  all  the  factors  of  an  economic 
advantage,  health  is  the  most  crucial.  Upon  this  hypothesis,  therefore, 
the  conclusion  may  rest  that  the  logical  primary  step  Ls  the  establish- 
ment of  a  broad  and  effective  study  of  health  as  related  to  laboring 
conditions."1 

More,  however,  than  a  study  of  health  is  now  being  under- 
taken by  many  firms.  We  are  finding,  usually  associated  with 
the  personnel  department,  a  health  division  or  section  in  which 
are  either  nurses  or  doctors  or  both.  We  are  finding  more  and 
more  attention  being  given  to  the  provision  of  hospital  facilities 
adjacent  to  plants,  to  health  instruction,  to  physical  examina- 
tions, to  clinics  for  workers.  Industrial  managers  are  on  the 
way  to  a  practical  recognition  of  health  as  the  basis  of  efficiency. 

As  a  result  of  this  new  emphasis  on  health,  the  medical  pro- 
fession itself  is  developing  specialists  in  the  medical  field. 

"Industrial  medicine,"  says  a  recent  writer,  "may  be  defined  as 
the  theory  and  practice  of  medicine  applied  to  the  purpose  of  preventing 
Mini  alleviating  sickness  and  injury  among  industrial  workers  in  order 
that  they  may  enjoy  the  benefits  of  continuous  productive  employment.''. 

Industrial  health  work  so  conceived  properly  covers  a  wide 
field.  It  includes  preventive  medicine;  personal  and  social 

1  FAVILU  13th  Bien.  llcp.,  Wisconsin  Bureau  of  Labor,  Pt.  Ill,  1907-08, 
p.  485. 

*SELBY,  C.  D.  Studio*  of  the  Medical  and  Surgical  Care  of  Industrial 
Worker*.  Wiwh.,  Govt.  Print.  Off.,  1919.  (Public  HmUh  Bui.  99,  p.  5.) 

84 


THE  HEALTH  OF  THE  WORKER  85 

hygiene;  factory  sanitation  and  safety;  emergency  surgery 
and  first  aid;  laboratory  tests  and  hospital  care;  deatal  prophy- 
laxis; mental  hygiene;  medical  follow-up;  eye,  ear,  nose  and 
throat  specialists  and  clinics  in  special  diseases.  Whether  or 
not  the  administration  of  all  of  these  activities  would  properly 
come  under  the  medical  section  of  the  personnel  department,  is 
a  question ;  although  the  tendency  is  undoubtedly  toward  putting 
all  a  plant's  work  which  is  directly  related  to  health  under  trained 
medical  supervision.  This  conclusion  has  been  reached  in  one 
plant  after  another  as  the  beneficial  results  of  preventive  health 
work  have  been  reflected  in  increased  output,  decreased  turn- 
over, decreased  absences  and  better  all  around  health. 

One  large  corporation,  although  in  many  respects  leading  in 
enlightened  industrial  practice,  was  opposed  to  strict  medical 
oversight.  Its  progressive  employment  director  studied  the 
turnover  attentively  and  found  that  during  the  past  year  thirteen 
per  cent,  of  the  men  leaving  went  on  account  of  ill  health  or 
because  their  physical  condition  demanded  outside  work.  This 
change  in  personnel  directed  the  attention  of  the  company 
to  the  necessity  for  selecting  workers  more  carefully  for  the  jobs 
they  were  to  do.  In  order  properly  to  select  men  it  became 
necessary  to  ascertain  the  physical,  mental  and  moral  qualities 
required  in  every  particular  job.  To  meet  this  need  the  semi- 
skilled and  unskilled  jobs  in  the  plant's  manufacturing  division 
were  analyzed  in  some  detail.  Thus  in  spite  of  the  firm's  reluc- 
tance to  adopt  health  supervision,  its  own  records  of  labor 
turnover  demonstrated  that  healthy  workers  were  the  most 
vitally  necessary  factor  in  successful  production. 

Nor  are  the  benefits  confined  to  the  management's  side.  To 
the  employee  adequate  health  supervision  brings  the  advantages 
of  increasing  his  earning  power  by  permitting  him  to  keep  himself 
in  proper  physical  condition;  by  preventing  him  from  injuring 
himself  by  overwork  or  carelessly  infecting  himself  or  his  asso- 
ciates. Industrial  medical  oversight  increases  the  understanding 
of  the  worker  concerning  personal  and  social  hygiene;  it  shows 
that  physical  incapacity  is  not  a  dispensation  of  Providence,  but 
largely  the  result  of  neglect  or  ignorance. 

The  Health  Program. — Assuming  then  that  there  is  trained 
medical  leadership  in  the  plant,  what  is  the  program  which  can 
profitably  be  carried  out?  We  submit  the  following  program: 


86  PERSONNEL  ADMINISTRATION 

A.  Physical  examination  prior  to  employment  and  periodically  thereafter 

of  all  new  and  old  employees,  including  follow-up  of  all  employees: 

1.  Periodical  physical   re-examination,   varying  for  different  groups 

of  workers  and  in  different  processes.  In  dangerous  processes 
or  for  workers  under  observation  and  treatment  this  re-examina- 
tion should  recur  quite  frequently. 

2.  Recommending  transfer  of  workers  for  health  reasons. 

3.  Clinical  follow-up  of  accepted  applicants  who  have  minor  defects. 

B.  Knowledge,  inspection  and  supervision  of  plant  working  conditions: 

1.  Sanitation   and   safety   of   general    plant   working   conditions   to 
eliminate  health  hazards. 

C.  Preventive  and  prophylactic  health  measures: 

1.  Immediate  attention  to  all  health  defects  found  in  physical  ex- 

aminations. 

2.  Immediate  attention  to  all  employees  incapacitated  from  accident 

or  illness. 

3.  Administration  of  first  aid;  dispensary;  hospital. 

4.  Knowledge  of  physical  requirements  of  trade  processes. 

5.  Health    education  including  constructive  advice  and   instruction 

on  personal  and  social  hygiene,  safety  and  sanitation. 

D.  Active  cooperation  in  health  matters: 

1.  Between  medical  staff  and  all  the  rest  of  the  plant  through  health 

committees. 

2.  Between  medical  staff  and  mutual  benefit  society  or  group  in- 

surance agents. 

3.  Between   industrial   corporations    and    private    or   public    health 

and  educational  agencies. 

4.  Between  industries  and  state  health  insurance  administrators. 

E.  Health  administration: 

1.  Staff. 

2.  Qualifications  of  physician ;  nurse. 

3.  Equipment;  records;  cost. 

4.  Responsibility  for  health  supervision 

Physical  Examination  and  Follow-up  of  Employees. — Modern 
corporations  increasingly  recognize  the  importance  of  definite 
standards  of  individual  health  as  a  test  for  employment.  Medi- 
cal examinations  as  a  prerequisite  to  employment  aie  being  con- 
stantly extended,  and  beneficial  results  are  being  shown. 

In  one  large  shipbuilding  plant  where  initial  physical  examina- 
tion of  workers  was  not  required,  the  company  discovered  among 
its  work  force  during  1918,  twelve  epileptics,  one  of  whom  had 
been  re-employed  three  times  under  different  names;  three  cases  of 
insanity  that  had  to  be  committed  to  the  asylum  at  an  expense 
of  $200;  several  cases  of  syphilis,  one  of  which  cost  the  company 
over  $400  for  treatment;  twenty-one  cases  of  ruptures,  a  number 


THE  HEALTH  OF  THE  WORKER  87 

of  whom  quit  work  after  successful  operation  at  the  plant's  ex- 
pense and  numerous  cases  of  other  more  or  less  serious  diseases. 

The  need  for  medical  examination  applies  both  to  men  and 
women  employees.  Indeed,  an  examination  by  a  woman  physi- 
cian is  essential  if  women  workers  are  not  to  be  misplaced  or 
injured.  They  must  be  watched,  studied,  trained  and  protected 
in  all  directions,  not  alone  for  their  own  sakes,  but  in  the  interest 
of  their  own  possible  offspring  and  of  the  national  health. 

The  reasons  for  a  physical  examination  should  be  sympathetic- 
ally explained  in  advance  to  every  worker.  He  should  under- 
stand that  the  examination  is  primarily  a  matter  of  health  pro- 
tection and  conservation;  that  the  management  wishes  to  offer 
him  work  for  which  he  is  physically  and  mentally  best  fitted,  and 
at  the  same  time  to  safeguard  him  and  others  from  accidents 
and  epidemics. 

Organized  employees  have  from  time  to  time  raised  objections 
to  physical  examinations.  But  upon  analysis  the  objection  is 
usually  found  to  apply  less  to  the  examinations  themselves  than 
to  the  abuses  which  might  possibly  arise  from  them. 

Organized  labor  apprehends  that  facts  discovered  by  medical 
examinations  may  be  used  to  jeopardize  the  position  of  industrial 
workers;  that  by  the  use  of  too  high  standards  competent  people 
may  be  debarred  from  employment;  and  that  firms  may  use 
the  excuse  of  physical  incompetence  to  exclude  union  sympa- 
thizers. They  maintain  that  responsibility  for  preventive  or 
curative  health  work  should  be  jointly  assumed  by  employers, 
workers  and  community.  The  criticism  of  labor  on  this  last 
point  has  particular  weight.  It  is  certainly  difficult  for  any  one 
plant  alone  to  cope  with  the  problem  of  rejecting  industrial 
workers  afflicted  with  tuberculosis,  venereal  or  other  infectious 
diseases.  The  need  is  for  a  program  of  community  attack 
through  preventive  and  restorative  clinics  which  will  distribute 
the  burden  of  rehabilitating  such  people  for  productive 
employment  regardless  of  their  present  industrial  connections. 

Indeed,  the  president  of  the  American  Federation  of  Labor  has 
endorsed  medical  examinations  provided  they  are  given  by 
publicly  employed  physicians  using  health  standards  which  have 
been  agreed  to  in  advance  by  the  organized  workers. 

Organized  labor's  anxiety  to  see  the  control  of  health  adminis- 
tration in  non-industrial  hands,  arises  from  a  genuine  sense  of  the 
limitations  upon  company  medical  work.  But  it  is  nevertheless 


ss  PERSONNEL  ADMINISTRATION 

true  that  much  can  be  done  to  foster  working  class  health  until 
that  day  when  the  community  itself  is  willing  to  cooperate  in  a 
thorough-going  preventive  program. 

Physical  examinations  when  intelligently  given,  and  when  used 
as  an  evidence  of  goodwill  in  personnel  work,  do  not  today  work 
to  exclude  applicants  from  jobs.  The  effort  is  rather  to  secure 
the  best  possible  adaptation  of  worker  to  job.  And  the  rejec- 
tions are  few — in  the  best  plants  less  than  four  per  cent,  of  the 
otherwise  successful  applicants.  Indeed,  in  the  larger  plants 
where  the  value  of  healthy  workers  is  really  understood,  appli- 
cants who  might  properly  be  rejected  on  physical  grounds,  are 
accepted  and  given  free  medical  treatment  in  the  company's 
corrective  clinics. 

Much  depends  upon  the  spirit  in  which  the  work  is  undertaken. 
Personal  medical  records  might,  of  course,  be  used  prejudicially 
to  the  individual's  immediate  interests.  Yet  if  the  company's 
motives  are  known  to  be  honorable,  if  its  efforts  at  correction 
are  known  to  be  sincere  and  thorough,  if  its  medical  records  are 
held  as  truly  confidential,  the  gain  from  the  health  work  is 
usually  far  greater  to  the  large  body  of  workers  than  any  pos- 
sible disadvantage  it  could  bring. 

A  few  companies  have  reached  a  point  where  they  recognize  a 
social  responsibility  for  those  members  of  the  community  who  do 
not  conform  to  their  usual  employment  standards.  They  con- 
tend that  each  community  has  its  residuum  of  handicapped  indi- 
viduals, and  that  it  is  the  duty  of  employers  to  place  these  to  the 
extent  that  it  does  not  endanger  the  life  and  health  of  cither  the 
handicapped  or  their  fellow-workers.  And  it  is  certainly  true 
that  with  a  little  study  useful  places  can  l>e  made  in  many  fac- 
tories for  some  who  are  blind,  or  deaf,  or  partially  crippled,  or 
slightly  below  the  average  mentally. 

The  character  of  the  medical  examination  will  naturally  vary 
with  the  physical  requirements  of  the  position  which  the  appli- 
cant is  to  fill.  Yet  no  examination  should  lx*  so  superficial  that 
it  does  not  cover  the  relation  of  height  to  weight,  lung  conditions, 
teeth,  head  and  throat,  sight  and  hearing,  possible  hernia,  and 
possible  communicable  diseases. 

Examinations  should,  of  course,  be  given  by  a  fully  qualifi**! 
doctor  who  shows  tact  and  patience  in  dealing  with  applicants. 
The  emphasis  of  his  whole  outlook  and  effort  should  Ix?  in  the 
direction  of  lieipiny  employees  to  stay  well  or  get  well.  There  will 


THE  HEALTH  OF  THE  WORKER          89 

therefore  be  special  value  in  having  the  medical  examinations 
followed  up  periodically  by  special  examination  into  known  dis- 
abilities. 

Considering  the  variety  of  dangerous  processes  to  which 
workers  are  exposed  in  many  industries,  the  value  of  periodic 
physical  re-examination  after  employment  becomes  as  great  as 
that  of  medical  examination  upon  admission.  Some  plants, 
especially  where  disease  hazards  are  known  to  be  great  or  where 
food  is  being  prepared,  find  it  worth  while  to  have  a  doctor  or 
nurse  re-examine  the  work  force  quite  frequently  in  order  to 
minimize  dangers  from  occupational  disease.  Moreover,  by  com- 
paring the  physical  status  of  its  employees  from  time  to  time 
such  companies  can  systematically  endeavor  to  raise  the  health 
standard  for  the  whole  establishment  and  consequently  the 
quality  and  quantity  of  output. 

Dental  Service. — Many  companies  are  finding  it  necessary  to 
provide  a  well  equipped  dentist's  office,  where  examination  and 
emergency  work  is  generally  free,  and  where  clinical  dentistry  is 
done  at  a  nominal  charge  for  materials  used  plus  the  dentist's 
time.  This  prompt  dental  service  has  frequently  resulted  in 
warding  off  incipient  rheumatism,  tuberculosis,  or  throat  epi- 
demics. The  head  of  a  large  industrial  dental  clinic  recently 
reported  that  one  dental  unit  working  full  time  is  needed  for 
every  500  to  600  employees.  In  this  clinic  every  patient  would 
require  from  forty-five  minutes  to  one  hour  for  prophylactic  or 
emergency  service  only,  at  a  cost  per  unit  of  $3  an  hour.1 

Dispensary  and  Hospital. — It  is  usually  justifiable  for  a  plant 
to  maintain  sufficient  hospital  or  dispensary  facilities  to  minister 
to  workers  who  become  mildly  indisposed  while  on  the  job. 
Many  hours  of  work  are  saved  to  corporations  and  many  hours' 
wages  to  workers  by  having  beds  or  couches  on  which  they  may 
recuperate  or  by  having  doctors  who  can  prescribe  beneficial 
treatment.  Yet  it  is  possible  to  go  too  far  in  this  eagerness  to 
get  workers  back  on  the  job.  If  employees  are  really  indisposed 
recovery  is  usually  more  prompt  if  there  is  thorough  regaining 
of  strength  before  he  or  she  tries  to  work  again.  Company  hospi- 
tals should,  indeed,  be  used  discreetly  so  as  not  to  strive  for  pre- 
mature cures  on  the  one  hand,  and  not  to  take  the  place  of  the 
family  physician  on  the  other. 

Large  modern  plants  often  have  separate  buildings  or  dispen- 

1  cf.  SELBY,  op.  cit.,  p.  37. 


90  PERSONNEL  ADMINISTRATION 

sary  and  hospital  wards,  even  though  bedridden  workers  are 
kept  there  only  temporarily.  Plants  located  in  country  dis- 
tricts where  community  provisions  for  medical  aid  do  not  exist, 
are  warranted  in  building  a  dispensary  or  hospital.  Such  com- 
panies have  a  special  responsibility  for  safeguarding  the  health 
of  their  employees. 

Where  no  hospital  facilities  are  furnished  on  the  factory  prem- 
ises, the  management  should  cooperate  with  existing  district 
nursing  and  other  civic  agencies,  or  subsidize  at  a  greatly  reduced 
cost  free  medical  assistance  or  endow  beds  for  industrial  workers 
in  the  local  institutions.  The  retaining  of  a  doctor  on  full  time 
service  or  the  creation  of  a  benefit  fund  that  hires  a  doctor  and 
nurse  are  possible  alternative  expedients. 

Health  Records. — Adequate  health  records  are  an  essential 
index  to  the  physical  condition  of  the  plant  and  of  the  workers. 
Records  of  causes  of  absence,  of  accidents,  sickness,  occupational 
diseases — all  are  vital  to  a  medical  policy  which  is  to  be  pursued 
intelligently.  Indeed,  such  records  can  often  supply  the  un- 
answerable evidence  in  behalf  of  needed  changes  in  personnel 
procedure. 

Health  Education. — The  various  industrial  health  problems  we 
have  thus  far  considered  will  not  be  most  effectively  met  until 
they  are  worked  at  in  conjunction  with  a  definitely  educational 
campaign.  Even  well  educated  workers  are  likely  to  be  seriously 
lacking  in  knowledge  about  the  ordinary  requirements  of  personal 
hygiene.  Constant,  sympathetic  group  and  individual  education 
in  matters  of  hygiene  and  medical  care  will  help  enormously  to 
build  up  the  permanent  vitality  of  all  the  workers. 

Health  Talks. — Educational  health  activity  may  include  brief 
group  talks  on  matters  of  constructive  health.  These  talks  may 
be  illustrated  by  simple  charts  or  diagrams  or  chemical  experi- 
ments. They  usually  consider  such  topics  as  personal  cleanliness; 
sex  knowledge;  proper  air  and  clothing;  food;  stimulants;  sleep; 
exercise;  home  sanitation  and  emergency  caro.  Talks  are  some- 
times given  on  the  personnel  service  activities  which  exist  to 
maintain  the  health  of  employees;  on  dental  care;  on  lunch 
room,  rest  and  recreation  facilities;  methods  of  fatigue  reduction; 
occupational  poisons;  factory  sanitation  and  industrial  insurance. 

A  largo  Western  company  made  periodic  use  of  these  talks  as 
a  means  of  training  its  employees  in  health  matters.  This  com- 
pany arranged  courses  of  one  hour  lectures  given  to  groups  of 


THE  HEALTH  OF  THE  WORKER  91 

from  twenty-five  to  thirty-five  people,  selected  so  that  factory 
production  was  not  affected.  Forty-five  minutes  of  the  time  weie 
on  "company  time."  The  remaining  fifteen  minutes  employees 
were  asked  to  give  from  their  noon  hour.  The  company  distrib- 
uted schedules  of  the  proposed  talks,  established  a  question  box 
and  gave  employees  an  opportunity  to  consult  the  factory  physi- 
cian personally  after  the  lecture  in  his  office.  The  course  proved 
so  popular  that  the  work  force  asked  to  have  it  repeated  be- 
fore the  employee  group  attending  the  summer  conferences  and 
training  schools  of  the  parent  company. 

Occupational  Diseases. — In  many  plants  there  is  need  for 
aggressive  research  work  by  the  medical  staff.  Especially  where 
there  are  problems  of  occupational  disease  hazard,  careful  follow- 
up  of  cases,  study  of  processes  to  devise  less  harmful  methods  or 
materials,  leporting  of  cases  to  state  boards  of  health  are  all 
aids  in  a  campaign  to  make  industrial  processes  safe  for  the  human 
organism. 

The  fact  that  much  of  the  work  entailed  in  fundamental  re- 
search into  prevention  measures  is  expensive,  is  not  an  argument 
for  its  indefinite  postponement ;  but  rather  for  getting  it  carried 
on  under  the  right  auspices.  This  is  a  field  in  which  trade  asso- 
ciations, medical  schools  and  labor  unions  can  profitably  cooperate 
and  minimize  what  would  otherwise  be  a  disproportionately 
large  expense  for  many  individual  firms. 

Fatigue  Study. — Determination  of  the  extent  of  excessive  fa- 
tigue is  a  second  research  function.  For  while  it  may  be  com- 
paratively easy  to  get  testimony  that  workers  "feel  tired," 
evidence  which  is  scientifically  conclusive  of  a  serious  lessening 
of  efficiency  is  secured  only  by  the  most  exacting  study. 

Fatigue,  as  authoritatively  defined,  is  a  diminution  of  working 
capacity  due  to  length  or  intensity  of  previous  activity.  And  it 
is  evidence  disclosing  the  extent  of  diminished  working  capacity 
which  is  therefore  needed.  Such  evidence,  it  should  be  said  at 
once,  is  not  easy  to  obtain  in  the  ordinary  plant.  For  it  pre- 
supposes the  existence  of  full  production,  accident  and  sickness 
records,  a  steady  flow  of  practically  identical  work  under  similar 
working  conditions  for  a  long  enough  period  to  admit  of  compari- 
son from  one  month  to  another,  and  done  by  enough  of  the  same 
people  to  afford  an  adequate  basis  of  comparison  from  one  worker 
to  another;  and  it  is  helpful  if  there  can  be  some  compaiison 
of  output  under  two  different  hourly  schedules — as  for  example 


92  PERSONNEL  ADMINISTRATION 

a  54  and  a  48  hour  week.1  In  a  word,  a  statistically  convinc- 
ing study  of  fatigue  presupposes  a  correlation  of  the  variable 
factors,  which  it  is  exceedingly  difficult  to  get  in  industiy  with 
the  usual  changes  in  orders,  seasons  and  workers. 

Nevertheless  the  practical  utility  of  such  study  has  been  dem- 
onstrated in  plants  which  have  found  it  more  economical  to 
have  workersydivide  the  day  between  two  different  types  of  work,v 
which  have  introduced  rest  periods  and  which  have  adopted  the 
eight  hour  day. 

Fatigue  will  appear,  of  course,  after  continued  application 
at  labors  which  are  thoroughly  enjoyable;  it  is  not  therefore  a 
psychological  so  much  as  a  physiological  problem.  It  is  less 
a  question  of  how  people  feel  than  of  how  they  act.  And  even 
in  their  actions  the  diminished  working  capacity  may  not  be 
cause  for  alarm  until  that  point  is  reached  where  complete  recovery 
of  vigor  and  health  is  not  possible  between  one  working  period 
and  the  next.  But  where  workers  are  chronically  tired  out  and 
no  full  recuperation  takes  place,  the  situation  is  progressively 
dangerous;  for  the  lowered  working  capacity  may  come  to  be 
considered  the  "normal"  working  capacity,  and  a  process  of 
slow  devitalization  is  then  likely  to  take  place.  Or,  if  the  effects 
of  fatigue  begin  to  be  consciously  recognized  by  the  workers,  they 
try  to  adjust  themselves  to  the  long  hours  or  arduous  toil  by  slow- 
ing down  the  working  pace  and  resting  at  frequent  intervals. 

Methods  for  the  discovery  of  a  serious  degree  of  fatigue  in- 
clude a  close  study  of  comparative  output  records  in  which  each 
hour's  output  is  disclosed,  records  of  accident  frequency  and 
causes,  of  sickness  fiequency  and  causes,  statements  of  power 
consumption  per  hour,  of  spoiled  work,  and  in  some  cases  of 
labor  turnover. 

Reduction  of  excessive  fatigue  may  require  a  reduction  in 
working  hours,  but  not  necessarily.  The  case  for  the  shorter 
work  day  (below  eight  or  nine  hours)  has  other  equally  strong, 
if  not  stronger,  reasons  to  be  urged  for  it  than  the  reduction 
of  fatigue,  since  it  may  be  difficult  at  work  done  for  that  num- 
ber of  hours  to  show  that  any  serious  diminution  of  working 
capacity  has  taken  place.  The  elimination  of  fatigue  is  rather 
to  be  found  in  corrective  efforts  upon  all  the  critically  modifying 

1  For  a  thorough  statement  of  methods  of  utilizing  factory  statistics  to 
detect  fatigue  see  FLOKENCE,  I*.  S.  Use  of  Factory  Statistics  in  the 
Investigation  of  Industrial  Fatigue. 


THE  HEALTH  OF  THE  WORKER  93 

factors — working  conditions,  the  work  content  and  incentive, 
types  of  machinery  used,  its  speed  of  operation  and  other  items. 

The  subordination  in  this  volume  of  fatigue  study  as  merely 
one  item  in  the  problem  of  health  maintenance  and  more 
especially  to  what  we  shall  subsequently  discuss  as  job  study 
or  analysis,  is  not  due  to  any  failure  to  appreciate  the  importance 
of  reducing  fatigue.  It  is  due  rather  to  a  conviction  that  in 
practice  all  the  contributing  causes  are  of  such  determining  im- 
portance that  the  study  of  the  job — job  analysis — seems  to  us 
to  be  of  the  greatest  service  in  helping  managements  to  preserve 
a  proper  perspective  in  any  corrective  or  preventive  work; 
and  when  the  job  analysis  is  adopted  it  naturally  means  the 
adoption  of  measures  which  almost  inevitably  reduce  fatigue. 

A  final  suggeslion  is  important.  Fatigue  is,  after  all,  a  resultant 
which  shows  in  individuals.  Any  widely  applied  regulation  of 
hours  "rests  upon  a  physiological  basis  devised  for  the  average." 
But  cases  will  inevitably  come  to  the  attention  of  the  personnel 
department  where  individual  workers  have  "gone  stale"  or  are 
"used  up"  even  under  a  reasonable  schedule  of  working  hours. 
"A  single  day  off,"  suggests  an  English  study,  "given  occasionally 
at  the  right  time,  would  have  avoided  much  wasteful  reduction 
of  capacity  and  in  the  worst  cases  the  total  loss  of  many  days' 
work."  Although  written  of  the  strenuous  war-time  working 
hours,  the  waining  is  a  useful  one  for  normal  times.  "If  once 
in  every  two  or  three  months, "  says  one  workman,  "a  man  could 
have  two  or  three  days  off  it  would  prove  the  finest  medicine."1 

Fatigue  study  thus  is  a  task  not  alone  of  finding  a  general 
level  of  factory  working  hours  which  is  healthful;  but  of  adapting 
the  length  of  each  individual's  daily  stay  at  one  job  to  his  capac- 
ities, and  of  being  on  the  watch  for  individuals  who  may  be 
temporarily  unable  to  stand  the  normal  pace. 

Lunch  Rooms. — Lunch  rooms  are  often  an  important  health 
asset.  The  human  machine  is  in  the  first  instance  a  "physico- 
chemical  engine."  To  keep  energy  at  the  full,  man  requires 
sufficient  and  proper  nourishment.  Food  is  a  stimulant  as  well 
as  an  energy  producer;  and  the  medical  section  can  often  advise 
usefully  about  food  values  and  healthful  lunches. 

The  custom  of  having  a  small  lunch  at  9.30  or  10  A.M.,  has  much 
to  commend  it  from  a  physiological  point  of  view.  In  some  plants 
lunches  brought  from  home  by  employees  are  supplemented  by 

1  Industrial  Health  and  Efficiency,  op.  tit.,  p.  42  and  p.  91. 


94  PERSONNEL  ADMINISTRATION 

soup,  milk  or  other  drinks,  sandwiches  or  pie,  distributed  from 
small  travelling  carts  at  a  moderate  price.  Other  plants  have 
regular  lunch  rooms  or  cafeterias  where  a  lunch  is  served  at  a  small 
charge. 

Factory  lunch  rooms  mav  usefully  meet  the  needs  of  an  in- 
convenient local  situation.  In  factories,  for  example,  located 
outside  city  limits  and  away  from  good  restaurants,  they  can  fur- 
nish hot,  wholesome  refreshments  and  a  few  small  luxuries  at  a 
reasonable  price. 

Where  a  regular  restaurant  or  lunch  room  is  operated,  the 
company  rarely  covers  all  expenses,  although  many  plants  meet 
all  direct  expenses  from  income.  Almost  all  employers,  however, 
testify  that  their  lunch  rooms  are  a  good  investment,  because 
employees  are  better  nourished  and  in  better  health  than  other- 
wise. And  even  where  local  conditions  are  such  as  to  warrant 
no  provision  of  a  lunch  room,  it  is  good  economy  to  provide  a 
clean,  comfortable  and  quiet  place  in  which  workers  can  warm 
up  and  eat  lunches  brought  from  home. 

Health  Committees. — The  effectiveness  of  industrial  health 
work  depends  upon  getting  the  confidence  and  cooperation  of 
the  rank  and  file.  To  Safety  First  must  be  added  the  Health 
First  slogan.  Just  as  thorough  industrial  safety  is  brought  about 
by  the  combined  efforts  of  management  and  men,  so  best  results 
in  health  work  will  be  accomplished  only  if  all  the  plant  groups 
cooperate  with  public  and  national  health  agencies. 

In  the  chapter  on  safety  we  have  advocated  a  committee 
procedure  with  regard  to  plant  safety  as  specially  helpful  in  cen- 
tering attention  in  accident  reduction.  In  the  same  way  the 
maintenance  of  a  plant's  health  work  is  better  assured  by  the 
cooperation  of  employee  committees. 

Health  committees  may  well  be  appointed  or  elected  to  study 
and  report  on  special  health  problems  peculiar  to  the  plant  or 
industry,  on  home  hygiene,  on  health  insurance,  on  public 
health  measures.  The  committee  may  even  help  in  formulating 
and  securing  cooperation  in  carrying  out  plans  for  maintaining 
the  health  of  employees  once  a  reasonable  standard  of  physical 
fitness  has  been  secured;  in  studying  attendance  records;  in 
deciding  on  health  standards  for  employees  at  different  jobs. 

Because  of  their  fundamentally  educational  functions,  these 
committees  may  well  be  periodically  rotated  in  order  to  give 
as  many  employees  as  possible  the  opportunity  to  inspect,  in- 


THE  HEALTH  OF  THE  WORKER  95 

vestigate  and  make  recommendations  regarding  the  plant's 
health  program. 

Cooperation  between  the  Medical  Section  and  Outside 
Agencies. — There  is  an  obvious  relation  between  good  industrial 
management  and  the  condition  of  the  local  sewage  system,  local 
water  and  milk  supply,  the  local  health  department  in  its  control 
of  communicable  diseases  and  its  inspection  of  unsanitary 
dwellings  and  stores.  So  direct  may  this  relation  become  that  it 
is  essential  for  the  staff  medical  section  to  know  local  provisions 
and  cooperate  wherever  possible  in  maintaining  or  obtaining 
wholesome  conditions.  How  much  can  be  done  toward  raising 
the  general  health  average  through  intelligent  cooperation 
between  industry  and  local  health  and  school  departments  is 
illustrated  by  the  recently  published  Committee  Report  of  the 
Framingham  (Mass.)  Community  Health  and  Tuberculosis 
Demonstration.  The  efforts  of  this  health  crusade  resulted  in  a 
drop  in  the  tuberculosis  death  rate  from  "93  per  100,000  in  1917 
to  a  rate  corresponding  to  76  for  the  first  five  months  of  1919." 

Efforts  at  health  conservation  are  of  course  not  confined  to 
local  agencies.  There  are  today  actively  engaged  in  various 
types  of  health  educational  work,  the  National  Association  for 
the  Study  and  Prevention  of  Tuberculosis,  the  State  Boards  of 
Health,  the  American  Medical  Association,  the  American 
Social  Hygiene  Association,  the  National  Committee  for 
Mental  Hygiene,  the  Life  Extension  Institute,  and  the  American 
Association  for  Labor  Legislation. 

There  is  also  being  developed  a  department  of  industrial 
hygiene  in  the  Harvard  Medical  School,  the  purpose  of  which 
is  to  train  doctors  in  the  special  branches  of  medicine  and  indus- 
trial relations  needed  for  industrial  physicians. 

Quite  the  most  significant  tendency  in  industrial  health  work, 
however,  is  the  growing  movement  for  state  health  insurance. 
This  insurance  would  require  weekly  contributions  from  em- 
ployers, employees  and  the  state  in  return  for  which  medical 
attendance  is  given  free  and  cash  benefits  of  a  certain  per  cent, 
of  wages  are  furnished  for  a  specified  number  of  weeks  in  each 
year.  Such  a  system  would,  of  course,  reach  all  workers  and  to 
the  extent  that  it  encouraged  programs  of  prevention  be  an 
immensely  helpful  influence  for  good  health.  Since  the  average 
worker  appears  to  lose  at  least  ten  days  a  year  through  sickness, 
there  is  opportunity  to  reduce  this  amount  by  preventive  meas- 


96  PERSONNEL  ADMINISTRATION 

ures,  and  to  institute  curative  steps  on  a  scale  that  would  save 
in  the  aggregate  thousands  of  days  to  the  workers  and  to  industry. 

Cooperative  Medical  Service. — The  problem  of  providing 
medical  service  of  the  proper  quality  arises  in  many  plants  which 
could  not  use  the  full  time  of  a  doctor  or  nurse,  or  believe  that 
they  cannot  afford  to  hire  them.  It  has  been  found  practical 
and  successful  in  some  cases  to  have  a  number  of  adjoining  plants 
cooperate  in  the  employing  of  a  doctor  or  nurse  and  in  the  pro- 
vision of  hospital  and  first  aid  facilities.  This  greatly  reduces 
the  cost,  makes  possible  the  procuring  of  a  thoroughly  trained 
staff,  and  assures  first-class  treatment  for  workers  in  all  the 
cooperating  companies.  In  a  few  communities  the  employment 
managers'  association  has  been  instrumental  in  getting  the 
smaller  plants  in  the  association  to  cooperate  in  providing  health 
facilities,  which  include  physician,  nurse  and  hospital. 

A  notable  instance  of  effective  medical  cooperation  is  the  Joint 
Board  of  Sanitary  Control  of  the  Cloak  and  Suit  Industry  of 
New  York  City,  employing  over  85,000  people.  This  board  is  a 
part  of  the  machinery  created  under  the  collective  bargaining 
of  the  industry,  and  its  work  is  to  supervise  all  the  factory 
sanitary  and  health  conditions.  It  has  been  instrumental  in 
gradually  raising  the  level  of  physical  working  standards  through- 
out the  industry,  and  its  work  is  now  extending  to  the  organiza- 
tion of  health  committees  of  workers  in  the  individual  shops. 

Such  joint  machinery  is  highly  desirable  in  industries  where 
the  extent  of  organization  on  both  sides  makes  it  practical  and 
effective.  But  where  the  workers  are  not  strongly  organized, 
it  is  necessary  always  to  guard  against  the  danger  of  health 
work  becoming  paternalistic  or  inquisitorial. 

One  way  of  handling  this  delicate  problem  so  as  to  avoid  this 
danger  is  to  have  the  company  cooperate  in  the  support  of  com- 
munity district  nurses  who  work  as  community  agents  and  have 
no  direct  relation  with  the  company.  This  tends  to  remove  in  a 
wholesome  way  the  natural  suspicion  of  workers  that  their  affairs 
are  being  unduly  pried  into.  The  need  for  home  nursing  work 
is  usually  substantial  and  the  benefits  of  it  so  great,  that  it  would 
be  unfortunate  to  lose  its  major  values  through  suspicion  of  its 
purposes. 

It  is,  indeed,  a  safe  general  principle  that  wherever  a  muni- 
cipality or  state  is  willing  to  administer  or  assume  a  major 
responsibility  in  administering  any  of  the  health  work  of  a  com- 


THE  HEALTH  OF  THE  WORKER  97 

munity,  managers  should  encourage  this  in  preference  to  building 
up  elaborate  provisions  of  their  own. 

Administration  of  Health  Work. — Industrial  medical  service 
has  not  been  standardized,  and  it  is  difficult  to  tell  how  much  of  a 
physician's  time  the  care  of  employees  requires,  or  how  large  a 
medical  organization  a  given  company  should  maintain. 

Existing  medical  staffs  vary  considerably  in  size  and  required 
expenses.  Some  large  and  geographically  isolated  companies 
employ  doctors  on  whole  time  and  give  them  hospitals,  dispen- 
saries, nurses  and  clerical  assistants.  Smaller  concerns  in  city 
localities  usually  require  a  doctor's  services  for  part  time  only; 
and  employ  a  nurse  or  other  medical  attendant  for  the  daily 
routine  work.  In  many  plants  a  doctor  is  on  call  only  for  surgical 
cases  or  accidents. 

The  Industrial  Physician. — The  attitude  of  the  factory  phy- 
sician toward  the  work  people  should  be  that  of  a  friend  who 
treats  them  with  respect,  and  sees  their  troubles  as  far  as 
possible  from  their  point  of  view.  To  be  effective,  his  services 
should  be  rendered  in  a  courteous,  cheerful,  and  sympathetic 
spirit.  He  cannot  hope  to  win  the  confidence  and  willing  co- 
operation of  the  work  force  without  extraordinary  patience, 
good  temper  and  professional  tact.  But  once  that  confidence 
is  established,  the  doctor  can  help  in  untold  ways  to  straighten 
out  all  sorts  of  individual  difficulties  which  would  otherwise 
create  unhappiness  and  destroy  effective  workmanship. 

The  Industrial  Nurse. — The  industrial  nurse  whose  work 
requires  more  than  first  aid  treatments  should  be  well  trained  in 
social  work,  district  nursing  and  visiting  housekeeping.  In  many 
problems  of  sanitation  and  first  aid,  dietetics  and  infant  welfare, 
moral,  domestic,  and  industrial  troubles,  her  counsel  will  be  freely 
and  usefully  sought  if  she  proves  to  be  a  person  who  invites  con- 
fidence. Workers  are  quick  to  respond  to  a  feeling  of  genuine 
personal  interest,  especially  where  serious  personal  problems  have 
arisen.  Through  daily  factory  trips  and  even  occasional  home 
visits  she  can  keep  in  touch  with  all  ill  and  absent  workers; 
and  in  some  plants  it  is  her  duty  to  investigate  all  cases  of  ab- 
sence and  tardiness.  She  needs  tact  and  patience  in  going  about 
among  the  employees'  families,  and  in  trying  to  coordinate  plant 
health  work  with  that  of  local  health  agencies. 

The  duties  of  the  industrial  nurse  depend  usually  upon  the  size 
of  the  plant.  In  some  cases  her  labors  are  confined  to  dispensary 
7 


98  PERSONNEL  ADMINISTRATION 

work  and  care  of  plant  accidents  and  illnesses.  Sometimes  she 
gives  instruction  in  industrial  hygiene  and  sanitation.  In  other 
cases  she  works  especially  in  the  families  of  foreign  employees 
on  prenatal  care,  dietetics  and  house  sanitation. 

As  a  rule  the  nurse  is  also  responsible  for  complete  and  accurate 
records  of  accident,  sickness  and  occupational  disease. 

Equipment  and  Cost. — Generally  speaking,  the  equipment  of 
medical  departments  depends  on  the  interest  shown  in  in- 
dustrial medical  service  in  the  various  companies  and  the  volume 
and  variety  of  work  done  by  the  industrial  physician  and  his 
staff.  Under  these  circumstances  it  is  practically  impossible  to 
make  any  statements  as  to  a  reasonable  cost  for  industrial 
medical  service.  Most  employers  agree,  however,  that  in  spite  of 
considerable  initial  expense,  expert  industrial  medical  service 
is  a  source  of  economy.  "It  prevents  litigation  and  keeps  men 
on  the  job." 

Responsibility  for  Medical  Service. — Industrial  medical 
departments  and  company  physicians  where  no  personnel  depart- 
ments exist,  are  responsible  to  various  company  officials.  In 
many  industries  medical  departments  have  been  a  personal 
interest  of  some  company  executive  rather  than  a  part  of  a  logical 
plan  of  rounded  personnel  work;  and  hence  they  seem  to  bear 
little  relation  to  the  rest  of  the  industrial  relations  work. 

The  purpose  which  industrial  medical  service  primarily  serves 
should,  however,  determine  its  relation  to  the  other  company 
functions.  If  the  medical  department  is  working  primarily 
to  reduce  compensation  claims,  it  would  naturally  lx>  affiliated 
to  the  legal  department.  If  the  object  of  the  medical  service 
is  to  stabilize  the  labor  forces  through  initial  physical  examina- 
tions, it  should  work  in  close  association  with  the  employment 
department. 

But  if  the  activities  of  the  industrial  medical  service  include, 
as  they  should,  the  administration  of  all  the  necessary  health 
activities  of  the  plant,  they  should  be  performed  under  the  per- 
sonnel department's  supervision.  Only  in  this  relationship  will 
the  health  services  be  developed  in  proper  relation  to  other  per- 
sonnel activities,  be  guided  by  the  right  point  of  view  and  there- 
fore be  of  maximum  value  to  management  and  men. 


THE  HEALTH  OF  THE  WORKER  99 

Selected  References 
INDUSTRIAL  HEALTH 

COMMONS,  J.  R.  Industrial  Goodwill,  N.  Y.,  McGraw-Hill  Book  Co.,  1919, 
pp.  92-105. 

ELLIS,  HAVELOCK.  Nationalization  of  Health.  (In  his  Essays  in  War 
Time,  1917,  pp.  138-147,  Ch.  12.) 

ERSKINE,  LILLIAN  and  JOHN  ROACH.  Standardization  of  Working  Essen- 
tials. (In  Annals,  American  Academy,  No.  160,  pp.  82-95,  May, 
1917.) 

,  R.  A.  Scientific  Management  and  Its  Relation  to  the  Health  of  the 
Worker.  (In  Taylor  Society  Bui,  v.  2,  No.  4,  pp.  11-13,  Nov., 
1916.) 

GEIER,  O.  P.  Health  of  the  Working  Force.  (In  Industrial  Management, 
v.  54,  pp.  13-19,  Oct.,  1917.) 

GOLDMARK,  JOSEPHINE.  New  Strain  in  Industry  and  Some  Specific  Studies 
of  Physical  Overstrain  in  Industry.  (In  her  Fatigue  and  Efficiency, 
3d  ed.,  1919,  pp.  43-120.) 

KOBER,  G.  M.  and  W.  C.  HANSON,  EDS.  Diseases  of  Occupation  and 
Vocational  Hygiene.  Philadelphia,  P.  Blakiston's  Son  &  Co.,  1916. 

SELBY,  C.  D.  Studies  of  Medical  and  Surgical  Care  of  Industrial  Workers. 
Wash.  Govt.  Print.  Office,  1919.  (Public  Health  Bui.  99.) 

U.  S.  BUREAU  OF  LABOR  STATISTICS.  Welfare  Work  for  Employees  in 
Industrial  Establishments.  Wash.  Govt.  Print.  Office,  1919.  (Bui. 
250.) 

WARREN,  B.  X.  and  EDGAR  SYNDENSTRICKER.  Health  Insurance;  Its  Rela- 
tion to  the  Public  Health.  Wash.  Govt.  Print.  Office,  1916.  (Bui. 
76.) 

WEBB,  SIDNEY  and  BEATRICE.  Sanitation  and  Safety.  (In  their  In- 
dustrial Democracy,  1914,  pp.  354-391.) 

WRIGHT,  F.  S.  Industrial  Nursing  for  Industrial,  Public  Health  and 
Pupil  Nurses,  and  for  Employers  of  Labor.  N.  Y.,  Macmillian  Co., 
1919,  pp.  165-174.) 

FATIGUE 

BENTINCK,  HENRY.  Industrial  Fatigue  and  the  Relation  Between  Hours 
of  Work  and  Output,  with  Memorandum  on  Sickness.  London, 
P.  S.  King  and  Son,  1918. 

FLORENCE,  P.  S.  Use  of  Factory  Statistics  in  the  Investigation  of  In- 
dustrial Fatigue.  N.  Y.,  Longmans,  Green  &  Co.,  1918. 

GILBRETH,  F.  B.     Fatigue.     (In  his  Motion  Study,  1911,  pp.  23-32.) 

GILBRETH,  F.  B.  and  L.  M.  GILBRETH.  Fatigue  Study;  the  Elimination  of 
Humanity's  Greatest  Unnecessary  Waste.  A  First  Step  in  Motion 
Study,  2d  ed.  rev.  N.  Y.,  Macmillan  Co.,  1919. 

GREAT  BRITAIN,  HEALTH  OP  MUNITION  WORKERS'  COMMITTEE.  Relation 
of  Fatigue  and  111  Health  to  Industrial  Efficiency.  (In  U.  S.  Bureau  of 
Labor  Statistics  Bui.  249,  1919,  pp.  33-45.) 

GREAT  BRITAIN.  Industrial  Fatigue  Research  Board.  Influence-  of  Hours 
of  Work  and  Ventilation  on  Output  in  Tinplate  Manufacture.  London, 


100  PERSONNEL  ADMINISTRATION 

H.  M.  S.  Office,  1919.  (Report  No.  1,  Industrial  Fatigue  Research 
Board.) 

GOLDMARK,  JOSEPHINE  and  MARY  D.  HOPKINS.  Comparison  of  an  Eight- 
Hour  Plant  and  a  Ten-Hour  Plant.  Wash.  Govt.  Print.  Office,  1920. 
(Public  Health  Bui.  106.) 

JONES,  E.  D.  Fatigue.  (In  his  Administration  of  Industrial  Enter- 
prises, 1916,  pp.  212-225.)  Bibliography  p.  225. 

LEE,  F.  S.  Human  Machine  and  Industrial  Efficiency,  N.  Y.,  Longmans, 
Green  &  Co.,  1918,  pp.  10-23. 

LINK,  H.  C.  A  Practical  Study  in  Industrial  Fatigue.  (In  Journal  In- 
dustrial Hyffiene,  v.  1,  No.  4,  pp.  233-237,  Sept.,  1919.) 

MttNSTERBERG,  HUGO.  Attention  and  Fatigue.  (In  his  Psychology  and 
Industrial  Efficiency,  1913,  pp.  206-220.) 


CHAPTER  IX 
A  SAFETY  PROGRAM 

The  spread  of  workmen's  compensation  insurance  and  the 
obviously  disruptive  effect  of  serious  accidents  on  shop  morale 
have  together  contributed  to  the  wide  adoption  of  factory  safety 
programs.  There  is  today  Little  objection,  at  least  in  theory,  to 
the  whole  safety-first  movement.  The  difficulty  is  rather  in 
assuring  that  plants  are  systematically  and  persistently  hammer- 
ing away  at  the  several  aspects  of  a  preventive  plan.  The  prob- 
lem is  now  one  of  method  rather  than  of  intention.  The  urgent 
question  is :  What  are  the  items  in  a  procedure  which  will  keep 
accidents  at  a  minimum? 

Causes  of  Accidents. — Accurate  answer  to  this  question  is  im- 
possible until  the  causes  of  accidents  are  fully  understood.  For 
the  causes  are  of  three  kinds;  and  they  require  three  fairly  dis- 
tinct lines  of  procedure.  Accidents  may  be  due  to  mechanical, 
physiological  or  psychological  causes. 

The  mechanical  deficiencies  are  obviously  to  a  large  extent  re- 
mediable. Unguarded  machinery,  dangerous  elevators,  slippery 
floors,  obstructed  passageways,  overspeeded  fly  wheels  and  all 
the  other  familiar  causes  for  which  the  worker  is  not  in  any  way 
to  blame,  have  their  cure  readily  at  hand  for  the  plant  which  will 
apply  it. 

The  physiological  causes  underlying  accidents  are  due  to  long 
hours  of  work,  an  unhealthy  working  environment,  inadequate 
lighting  or  ventilation,  tasks  that  are  monotonous  or  arduous. 
The  manner  in  which  a  worker  handles  himself  or  performs  nis 
duties  is  profoundly  influenced  by  his  bodily  condition.  A  man 
who  suffers  from  overstrain  and  worry,  or  from  excessive  fatigue, 
is  not  a  safe  person  in  the  neighborhood  of  any  accident  hazard. 

The  psychological  causes  of  accidents  are  ignorance,  inexperi- 
ence, carelessness,  recklessness,  lack  of  plant  discipline  and 
supervision. 

To  cope  with  these  causes  is  not  the  responsibility  of  one  group 
alone;  it  must  be  the  responsibility  of  all  groups  in  the  plant. 
For  perfect  as  the  mechanical  preventive  devices  may  be,  they 

101 


102  PERSONNEL  ADMINISTRATION 

can  never  be  a  substitute  for  personal  caution  and  good  sense. 
There  are,  indeed,  certain  duties  which  managers,  foremen  and 
workers  must  severally  recognize. 

Management's  Responsibility. — The  management  must  begin 
by  making  structural  and  mechanical  conditions  safe.  This  in- 
volves a  program  of  technical  study  and  mechanical  installa- 
tion; a  program  of  education  of  superintendents,  foremen  and 
workers;  and,  in  order  to  carry  out  these  two  with  consecutive 
and  expert  attention,  the  creation  of  a  safety  division  in  the  per- 
sonnel department.  To  this  division  should  be  given  full  re- 
sponsibility for  plant  safety  and  for  the  preventive  work  in  all 
directions. 

But  perhaps  the  most  important  responsibility  of  the  manage- 
ment is  to  give  evidence  of  its  sincerity  in  urging  safety-first. 
For  workers  who  are  cautioned  to  be  careful  in  one  breath  and 
who  are  rushed,  speeded  up  and  made  to  feel  driven  throughout 
the  day  in  the  next,  realize  that  the  management's  protestations 
do  not  square  with  its  actual  policy.  Workers  on  piece-rate 
operations  are  not  impressed  with  the  management's  regard  for 
safety  if  the  regulations  about  safety  devices  cut  down  wages. 
Indeed,  managers  should  realize  that  this  is  not  the  point  at  which 
the  costs  of  safety-first  work  can  best  be  met.  Arrangements 
under  which  careful  adherence  to  rules  has  the  indirect  effect 
of  reducing  a  worker's  wages  will  certainly  never  become  popular 
in  the  shop. 

Foremen's  Responsibility. — The  actual  effectiveness  of  a  safety 
program  depends  in  large  part  upon  the  foremen's  willingness  to 
follow  it  out  in  the  right  spirit.  As  the  agent  of  the  management 
the  foremen,  in  constant  touch  with  the  men  actually  on  the 
job,  can  be  the  determining  factor  in  instilling  the  safety-first 
spirit.  It  is  often  his  duty  to  instruct  new  workers  in  the  use  of 
safety  devices  and  acquaint  them  with  safety  regulations.  He 
should  point  out  trade  hazards  and  caution  the  men  against 
carelessness,  disorder  or  exposure  to  danger.  New  employees 
are  six  times  as  liable  to  accidents  as  experienced  men.  Yet  old 
employees  transferred  to  new  work  should  also  l>e  taught  how 
to  avoid  injury  and  do  their  particular  work  in  the  safe  way. 
The  foreman's  quiet  suggestion  will  usually  prove  more  helpful 
than  disciplinary  measures,  and  a  kindly  demonstration  of  right 
methods  tends  to  leave  a  better  impression  on  the  worker  than 
a  "bawling  out." 


A  SAFETY  PROGRAM  103 

The  safety  engineer  can,  therefore,  profitably  devote  consider- 
able personal  attention  to  persuading  foremen  of  the  importance 
of  attention  to  safety  and  to  discussing  methods  with  them.  To 
recognize  in  some  public  way  the  foreman  in  whose  department 
there  are  the  fewest  accidents,  is  sometimes  useful.  To  have  a 
foremen's  committee  on  accidents  and  their  causes  is  another 
helpful  method. 

Workers'  Responsibility. — Just  as  the  management's  attitude 
toward  safety  determines  the  foremen's,  the  foremen's  attitude 
in  turn  determines  that  of  the  manual  workers.  Especially  has 
the  foreman  to  meet  a  peculiar  sort  of  callousness  and  bravado 
in  his  men,  which  makes  them  take  chances  that  are  foolish  and 
dangerous.  It  is  frequently  hard  to  rid  a  group  of  workers  of  the 
idea  that  they  are  "mollycoddling"  themselves  if  they  give 
proper  concern  to  safe  methods.  Every  graphic  device  is  usually 
needed  to  dramatize  the  effects  of  carelessness  on  one's  self  and  on 
one's  family — to  make  workers  count  the  costs  of  foolhardiness 
in  advance. 

The  workers'  responsibility  for  accident  prevention  is  in  the 
direction  of  appreciating  the  significance  of  accidents  to  his  fel- 
lows and  to  himself.  It  is  his  responsibility  to  keep  alert,  to 
obey  the  safety  rules,  to  be  a  committee  of  one  on  accident 
prevention. 

Preventive  Measures. — Among  manual  workers  the  work  of 
accident  prevention  involves  a  continuous  effort  in  a  great 
variety  of  ways  to  drive  home  the  safety  habit.  To  extend  the 
safety  idea  instruction  should  be  given  in  simple,  non-technical 
terms,  with  illustrations  wherever  possible.  Every  workman 
should  carry  the  safety  rule  book  for  his  information  and  perhaps 
even  be  occasionally  examined  upon  his  knowledge  of  the  specific 
rules  used  in  his  department.  Where  the  foreman  supervises  non- 
English  speaking  laborers,  an  interpreter  should  be  used  to  assure 
their  understanding  of  the  hazards  and  necessary  precautions. 
The  simplest  safety  instructions  should  be  repeated  over  and 
over  again  even  after  they  are  fully  understood. 

Suggestions  from  Employees. — Workers'  interest  in  being 
careful  is  frequently  stimulated  by  inviting  their  suggestions  for 
prevention.  Employees  may  usually  be  asked  to  help  correct 
physical  plant  defects  or  eliminate  dangerous  practices.  For 
this  purpose  suggestion  boxes  with  pads  and  pencils  conveniently 
attached  are  sometimes  placed  throughout  the  factory.  The 


104  PERSONNEL  ADMINISTRATION 

North  Western  Railroad  received  in  the  first  three  years  of  its 
safety  work  6,000  suggestions  from  its  workmen,  and  all  but  200 
were  accepted  and  carried  out.  Many  corporations  award 
monthly  prizes  for  the  best  suggestions  to  prevent  accidents;  and 
explain  reasons  for  rejection  to  an  unsuccessful  suggestor  in 
order  to  retain  his  cooperation  in  safety  work. 

Safety  Publicity. — Advertise  safety!  The  works  paper,  the 
local  press,  the  pay  envelope  may  all  be  used  as  means  of  safety 
publicity.  Cartoons  or  brief  notices  in  simple  language  are  best 
for  this  purpose.  Insert  cards  bearing  safety  slogans  may  be 
slipped  into  the  pay  envelopes  or  placed  in  the  time  card  racks. 
In  establishments  employing  large  numbers  of  workers  advertis- 
ing is  a  fruitful  method  of  planting  seeds  of  caution  to  make  men 
think  and  act  safety. 

Bulletin  boards  located  in  conspicuous  places,  or  where  workers 
congregate  at  lunch  time,  are  among  the  most  effective  means  of 
continuing  safety  interest.  The  boards  must  be  attractively 
gotten  up  and  kept  "alive"  by  a  frequent  change  of  bulletins, 
illustrating  graphically  accidents  due  to  the  absence  of  safeguards 
and  those  caused  by  the  workman's  lack  of  care.  Materials 
include  pictures  of  injured  men,  cartoons,  departmental  accident 
records,  brief  notices  of  serious  accidents  or  measures  designed 
for  promoting  health  and  safety  in  the  industry.  The  proper 
use  of  bulletin  boards  everlastingly  reminds  the  worker  what  he 
can  do  for  his  own  protection. 

Safety  Rallies. — Another  permanent  educational  method  in 
accident  prevention  is  the  safety  rally  for  employees  and  their 
families.  Here  the  doctrine  of  safety  is  preached  in  short 
lectures  on  safety  in  various  trades;  habits  of  caution  in  workmen; 
occupational  disease  and  its  consequences;  the  value  of  safety 
and  allied  activities  as  an  investment  and  detail  of  efficient 
organization.  Stcreopticon  views  are  shown  on  safety  devices 
in  actual  use  at  the  shop;  first  aid  exhibits;  "the  reason  why," 
or  the  right  and  wrong  way  of  doing  a  job;  "be  careful  first," 
illustrating  accident  prevention  work.  Moving  pictures  arc 
given  on  the  "high  cost  of  hurry,"  dangers  of  the  street  in  stealing 
rides,  crossing  in  front  of  or  Ixmrding  moving  cars,  demonstrating 
the  unsafe  practices  daily  followed  by  railroad  men. 

Importance  of  Personal  Hygiene. — Accident  reports  show 
that  many  serious  and  painful  accidents  come  from  infection 
through  neglecting  scratches  or  other  slight  injuries.  These  are 


A  SAFETY  PROGRAM  105 

apt  to  develop  blood  poisoning,  which  brings  on  complications 
making  recovery  difficult  if  not  impossible;  and  the  result  is 
often  the  loss  of  the  injured  member.  Employees  should  under- 
stand why  minor  injuries  should  receive  immediate  treatment  at 
the  factory.  They  should  realize  the  seriousness  of  infection, 
and  appreciate  the  value  of  personal  hygiene.  To  lead  a  clean 
life,  have  clean  hands  when  eating,  wear  clean  clothes,  keep 
clean  and  exercise  personal  caution  are  vital  aids  in  a  program  of 
accident  prevention. 

Personal  Contacts. — Safety  films  are  sometimes  accompanied 
by  a  brief  talk  given  by  one  of  the  plant  executives.  Personal 
contacts  between  management  and  men  are  often  helpful  in 
convincing  employees  that  safety  is  a  vital  proposition.  At  the 
National  Tube  Company's  McKeesport  factory  the  general 
manager  closes  some  one  department  each  month  at  twenty 
minutes  to  twelve,  in  order  to  tell  the  men  in  a  personal  talk 
what  they  have  suffered  from  accidents  during  that  month,  how 
much  they  have  lost  in  wages,  what  the  company  is  willing  to  do, 
and  finally  to  ask  their  cooperation  in  accident  prevention. 
This  personal  effort  of  the  head  executive  has  put  new  life  and 
interest  in  the  company's  safety  movement. 

Team  work  counts  here  as  elsewhere.  Accidents  will  usually 
decrease  when  every  one  does  his  part.  It  is  to  the  mutual  interest 
of  the  company  and  the  rank  and  file  to  work  harmoniously  in 
matters  of  safety.  What  then  is  a  good  plan  of  shop  safety 
organization? 

Shop  Safety  Organization. — It  is  absolutely  necessary  that 
safety  work  should  be  given  the  same  dignified  position  in  a 
plant  as  any  other  distinct  personnel  activity.  To  this  end  it 
should  be  given  status  as  an  administrative  division  of  the  per- 
sonnel department  under  the  leadership  of  a  trained  safety 
engineer.  Operating  officials  of  large  concerns  are  usually 
too  busy  to  keep  stimulating  fresh  safety  enthusiasm.  Their 
human  relations  with  the  work  force  are  not  as  close  as  can  be 
those  of  the  various  executives  of  the  personnel  department. 
The  director,  the  safety  engineer  and  the  plant  doctor  with  their 
assistants  can,  therefore,  better  develop  new  ideas  in  accident 
prevention  and  apply  or  direct  them.  Such  a  delegation  of 
safety  work  should  not,  however,  absolve  other  executives  from 
interest  in  this  problem.  It  is  usually  found  useful  from  many 


106  PERSONNEL  ADMINISTRATION 

points  of  view  to  have  a  variety  of  committees  working  at  safety 
from  different  angles. 

The  safety  engineer  should  attend  or  follow  up  all  committee 
meetings,  plan  the  details  of  the  work,  receive  reports,  recom- 
mendations, suggestions,  and  keep  all  necessary  records.  He 
also  works  in  close  relations  with  the  chief  engineer  of  the  plant, 
or  the  department  of  mechanical  maintenance,  in  devising  and 
installing  preventive  guards  of  all  sorts.  His  personal  contact 
with  foremen  and  workmen  cannot  be  too  closely  developed, 
for  only  as  he  stands  in  intimate  relation  to  these  people  does 
he  get  their  best  cooperation. 

Executives'  Committee. — A  central  safety  committee  com- 
posed of  executives,  the  manager  or  his  assistant  acting  as  chair- 
man, the  safety  engineer  as  secretary,  has  in  some  plants  general 
supervision  over  all  safety  work.  It  gathers  information,  es- 
tablishes standards,  formulates  rules,  considers  reports  and 
outlines  all  educational  activities.  From  the  reports  received 
by  this  committee  is  measured  the  burden  of  accidents  to  the 
individual  injured  and  to  the  business. 

This  central  committee  delegates  some  of  its  duties  to  the 
departmental  safety  committee  in  charge  of  the  foreman.  It 
gives  the  foreman  an  active  part  by  placing  responsibility  for 
safety  and  the  enforcement  of  safety  rules  on  him.  The  fore- 
man's constant  investigation  of  all  accidents  or  injuries  occurring 
among  his  men  form  the  basis  of  the  monthly  written  accident 
report  requested  of  him  by  this  committee.  It  discusses  with 
him  recent  accident  experience  and  exchanges  suggestions  in 
regard  to  remedying  conditions  or  reaching  the  worker.  These 
meetings  between  central  and  departmental  committees  do 
much  to  line  up  foremen,  keep  them  interested  and  enthusiastic 
in  upholding  the  company's  safety  campaign. 

Workmen's  Committee. — A  most  important  feature  of  or- 
ganized safety  work  is  the  workmen's  safety  committee,  com- 
posed of  several  workers  appointed  by  the  foreman  or  elected  by 
their  fellows  and  rotating  periodically  in  membership  to  allow 
each  worker  a  turn.  Workers  who  serve  on  a  safety  committee 
come  naturally  to  feel  that  they  are  responsible  for  preventive 
measures  and  they  thus  l>ecome  vitally  interested. 

Each  department  should  have  its  own  committee  making 
regular  shop  inspections  on  company  time,  and  examining  into 
causes  of  accidents.  These  committees  should  give  a  written 


A  SAFETY  PROGRAM  107 

report  to  the  foreman  of  their  findings,  with  recommendations 
for  eliminating  plant  hazards  or  improving  dangerous  methods. 
A  worker  serving  on  this  committee  learns — what  no  one  can 
make  him  believe — that  most  accidents  must  and  can  be  pre- 
vented by  active,  willing  cooperation  on  the  part  of  employees. 
His  committee  experience  in  investigating  causes  of  departmental 
accidents  makes  of  him  a  missionary  for  safety,  and  thus  helps  to 
educate  fellow  workers  in  a  precautionary  attitude. 

The  administration  of  safety  work  in  close  cooperation  with 
foremen's  and  workers'  groups  has  a  value  over  and  above 
that  of  reducing  accidents.  Safety  is  a  common  interest  of  all 
groups  in  industry;  and  common  efforts  in  its  maintenance  lead 
to  common  efforts  in  other  directions — lead  to  a  habit  of  joint 
action  which  can  usefully  be  extended  to  other  fields.  The  presi- 
dent of  a  large  paper  mill  company  said  not  long  ago :  "  I  would 
consider  every  dollar  we  have  put  into  this  safety  work  well 
spent  even  if  it  had  not  saved  a  life  or  prevented  an  accident, 
because  of  the  get-together  feeling  the  movement  has  engendered 
in  the  plant." 

Conclusion. — The  .best  guarantee  of  safety  in  the  plant  is  a 
body  of  careful  and  alert  workers.  Carefulness  and  ialertness 
are  thus  intangible  assets  which  are  of  great  value  not  alone  in 
reducing  accidents  but  in  effecting  economies  in  other  ways. 
Like  other  assets  they  can  be  held  only  at  a  price.  The  price 
is  absence  of  drive  and  fatigue,  a  policy  throughout  the  works 
which  sets  life  above  dollars,  an  educational  campaign  which 
translates  this  policy  into  a  demand  for  good  quality  product 
made  under  wholesome  conditions  and  by  workers  who  feel 
themselves  fairly  treated. 

A  safety  program  which  is  to  be  successful  cannot,  in  short, 
be  separated  from  the  personnel  program  as  a  whole.  Until  it  is 
dominated  by  a  human  point  of  view  and  directed  by  one  who 
understands  and  values  men  as  human  beings,  such  a  program  is 
in  danger  of  being  perfunctory  and  sporadic. 

Selected  References 

CAMPBELL,  R.  W.    How  to  Organize  for  Safety.    (In  BLOOMFIELD,  DANIEL, 

ED.     Selected     Articles    on    Employment     Management)     1919,    pp. 

468-472. 
CHANEY,  L.  W.  and  H.  S.  HANNA.     Accidents  and  Accident  Prevention  in 

Machine    Building.     Washington    Govt.    Print.    Off.,    1917.      (U.    S. 

Bureau  of  Labor  Statistics  Bui.  216.) 


108  PERSONNEL  ADMINISTRATION 

CHANEY,  L.  W.  and  H.  8.  HANNA.  Safety  Movement  in  the  Iron  and 
Steel  Industry  1907  to  1917.  Washington  Govt.  Print.  Off.,  1918. 
(U.  S.  Bureau  of  Labor  Statistics  Bui.  234.) 

COMMONS,  J.  R.  and  J.  B.  ANDREWS.  Principles  of  Labor  Legislation. 
N.  Y.,  Harper  Bros.,  1916,  pp.  295-353. 

EASTMAN,  CRYSTAL.  Work  Accidents  and  the  Law.  N.  Y.,  Russell 
Sage  Foundation,  1916. 

HOFFMAN,  F.  L.  Industrial  Accident  Statistics.  Washington  Govt. 
Print.  Off.,  1915.  (U.  S.  Bureau  of  Labor  Statistics  Bui.  157.) 

HOLMAN,  D.  M.  Educational  Work  in  Accident  Prevention.  Wash- 
ington Govt.  Print.  Off.,  1917.  (U.  S.  Bureau  of  Labor  Statistics  Bui. 
210,  pp.  128-144.) 

JOHNSON,  F.  R.  Reducing  the  Hazards  of  Peace.  (Survey,  v.  42,  pp. 
566-567,  July  12,  1919.) 

NATIONAL  SAFETY  COUNCIL.  Accident  Records;  How  to  Compile  Them 
and  How  to  Use  Them.  Chicago,  pub.  by  Council.  1919(?)  (Safe 
Practices  No.  21.) 

NATIONAL  SAFETY  COUNCIL.  Principles  and  Practice  of  Safety;  a  Hand- 
book for  Technical  Schools  and  Universities.  Chicago,  pub.  by 
Council,  1919. 

NATIONAL  SAFETY  COUNCIL.  Proceedings,  lst-7th.  1912-18.  Chicago, 
pub.  by  Council. 

NATIONAL  SAFETY  COUNCIL.  Safe  Practices,  ed.  by  E.  R.  WRIGHT,  (v.  1, 
Nos.  1-6.)  Chicago,  pub.  by  Council. 

Nzw  YORK  STATE  INDUSTRIAL  COMMISSION.  Plan  for  Shop  Safety, 
Sanitation  and  Health  Organization.  Albany,  N.  Y.,  pub.  by  Com- 
mission, 1919.  (Special  Bui.  No.  91.) 

PRICE,  G.  M.     The  Modern  Factory.     N.  Y.,  John  Wiley  &  Son,  1914. 

ROBINSON,  J.  A.  Possibilities  of  Cooperative  Effort  in  Safety  and  Hygiene. 
(U.  S.  Federal  Board  for  Vocational  Education,  v.  1,  pp.  21-22,  Feb., 
1919.) 

U.  S.  EMPLOYEES'  COMPENSATION  COMMISSION.  Federal  Standards  for 
Crane  Construction,  1918.  Machine  Guarding,  1918.  Power  Plants, 
1918.  Safeguarding  Power  Transmission  Apparatus,  1918.  Safeguard- 
ing Remote  Control  Apparatus,  1918. 

U.  S.  EMPLOYEES'  COMPENSATION  COMMISSION.  Federal  Standards  for 
Safeguarding  Elevators,  as  Prepared  by  the  Bureau  of  Standards  in 
Conjunction  with  the  Safety  Engineers  of  Federal  Industrial  Es- 
tablishments. Wash.,  1918.  Typewritten. 

U.  8.  SHIPPING  BOARD,  EMERGENCY  FLEET  CORPORATION.  Safety  Speci- 
fications for  Plant  Construction  and  Equipment.  Philadelphia,  pub. 
by  Corporation,  1918. 

U.  S.  STEEL  CORPORATION  COMMITTEE  OF  SAFETY.  General  Require- 
ments for  Safety.  Pub.  by  Corporation.  1918. 

WILLIAMS,  S.  J.  Safety  as  the  Employment  Executive  Should  See  It. 
(Industrial  Management,  v.  57,  pp.  501-503,  June,  1919.) 


CHAPTER  X         «~^ 
STANDARDS  OF  PHYSICAL  WORKING  CONDITIONS 

The  importance  of  safe,  wholesome  and  attractive  workshops 
is  today  widely  recognized.  There  can  be  neither  maximum 
efficiency,  mutual  goodwill  nor  genuine  self-respect  in  the  work- 
ing force  if  working  conditions  are  dangerous,  disagreeable  or 
unhealthy.  It  is  to  everyone's  interest  that  the  work  environment 
conform  to  what  are  now  well  established  scientific  standards. 
Other  things  being  equal,  the  factory  with  the  best  conditions 
gets  the  best  class  of  employees,  holds  them  longer  and  turns  out 
a  better  grade  of  product. 

It  is,  therefore,  our  purpose  to  set  forth  here  from  the  point  of 
view  of  the  administrator  of  personnel  work,  the  items  which 
should  be  considered  in  providing,  inspecting  and  improving 
working  conditions,  and  to  indicate  what  seems  to  be  reasonable 
standard  practice  in  connection  with  each.  The  chapter  will 
thus  serve  a  double  purpose.  It  becomes  in  effect  a  check-list 
of  the  most  important  items  in  physical  working  conditions; 
and  it  is  a  statement  of  standards. 

One  or  two  words  of  explanation  are  first  necessary.  We  are 
distinctly  not  posing  as  technical  experts  in  the  several  fields 
covered  in  this  chapter.  We  do,  however,  desire  to  present  what 
we  believe  every  competent  employment  administrator  should 
have — an  approximately  accurate  statement  of  the  best  expert 
conclusions  on  matters  of  working  conditions,  and  a  guide  to 
further  sources  of  information  and  technical  counsel.  It  would, 
for  example,  be  fatal  for  the  administrator  of  personnel  work  to 
attempt  to  design  or  install  an  exhaust  system;  but  the  admin- 
istrator who  is  "on  his  job"  will  be  able  to  have  an  opinion  as  to 
whether  a  proposed  system  will  meet  his  plant's  needs  satisfac- 
torily. The  mechanical  engineer  and  the  lighting,  heating  or 
ventilating  consultant  are  not  infallible.  Too  many  cases  of 
grievous  error  in  judgment  and  execution  have  come  to  our  notice 
in  factories  for  us  to  advise  that  the  expert  should  be  always 

109 


110  PERSONNEL  ADMINISTRATION 

on  top.  Ho  should  be  on  tap;  and  his  conclusions,  like  those  of 
specialists  in  other  fields,  should  be  scrutinized  by  the  more 
general  executives  who  have  common  sense,  who  know  the 
workers'  point  of  view,  who  combine  some  technical  knowledge 
with  a  knowledge  of  the  rest  of  the  factory's  problem. 

When  in  doubt  call  in  the  expert,  is  a  good  rule  in  matters  of 
working  conditions;  and  another  is:  Know  all  you  can  yourself 
about  the  problem  on  which  you  seek  advice. 

Again,  we  are  assuming  here  that  the  administration  of  phys- 
ical working  conditions  is  assigned  to  the  personnel  department. 
Matters  relating  to  plant  housekeeping  are  so  clearly  related 
to  the  workers'  attitude  that  no  other  department  promises  to 
function  here  so  faithfully.  Logically  the  attitude  of  mind  in 
which  working  conditions  will  be  looked  after  most  satisfactorily 
is  that  which  the  personnel  executive  has.  Once  the  respon- 
sibility for  administering  working  conditions  is  undertaken  by 
the  personnel  department,  the  next  job  is  to  determine  the  items 
to  be  included. 

It  may  be  objected,  however,  that  on  many  of  the  matters  here 
considered  there  are  laws  or  governmental  regulations  which 
render  any  concern  about  them,  except  by  the  official  factory 
inspector,  superfluous.  This  attitude  wholly  ignores  several 
patent  facts:  First,  that  the  legal  standards  are  often  vague,  are 
far  from  uniform  and  are  minimum  standards  only;  second,  that 
factory  inspection  is  by  no  means  adequate  in  many  states;  and 
third,  that  the  basis  for  determination  of  sound  procedure  in 
personnel  relations  is  not,  and  never  can  be,  completely  emlx>died 
in  law.  The  answer  to  the  objection  is,  therefore,  that  while 
legal  standards  furnish  an  index  to  some  widely  accepted  stand- 
ards, they  seldom  comprise  what  any  competent  manager  would 
regard  as  satisfactory  standard  practice. 

In  concluding  this  introduction  we  are  anxious  to  meet  the 
further  possible  objection  that  standard  conditions  arc  all  very 
well  if  one  can  build  an  entirely  new  plant,  but  that  under  exist- 
ing conditions  little  can  l>e  done.  There  are  two  aspects  to  this 
very  real  difficulty  which  should  be  noted;  first,  as  to  the  older 
factories;  second,  as  to  expense.  It  is  unquestionably  true  that 
the  new  plant  has  a  great  advantage.  It  is  even  true — and  we 
speak  from  experience  in  over  a  score  of  industries — that  working 
conditions  in  what  have  been  regarded  as  the  most  disagreeable 
and  ofTcn.sive  industries  can  with  new  construction  be  made  prac- 


STANDARDS  OF  PHYSICAL  WORKING  CONDITIONS     111 

tically  unobjectionable  if  thought  and  pains  are  expended.  There 
is  in  the  newer  factories  today  no  inherent  reason  why  the  workplace 
should  be  ugly,  repellent  or  unwholesome.  If  only  we  can  get 
that  idea  fixed  in  managers'  minds,  we  can  make  rapid  strides 
toward  correction  of  the  defects  which  remain. 

But  this  does  not  meet  the  conditions  of  the  old  fashioned 
factories.  Concerning  them,  it  is  our  observation  that  the  most 
serious  difficulty  is  that  managers  do  not  try  to  use  to  best  ad- 
vantage the  equipment  which  they  have.  They  seem  to  forget 
what  wonders  can  be  performed  by  the  constant  application  of 
soap  and  water  and  paint  and  broom;  there  is  often  less  a  crying 
need  for  new  facilities  than  a  need  for  the  clean  and  orderly 
maintenance  of  those  which  exist. 

Yet  this  is  not  always  true.  There  are  cases  where  over  a 
period  of  twenty-five  years  it  will  prove  cheaper  in  dollars  and 
cents  to  rebuild  from  the  ground  up  at  once,  than  to  tinker  here 
and  there,  and  never  have  a  thoroughly  desirable  work  place  to 
show  for  the  trouble.  There  are  some  corporations  in  which 
this  procrastination  has  become  a  habit.  They  ward  off  every 
suggestion  of  improvement  by  pointing  out  that  "in  the  new 
plant  all  will  be  different."  The  employment  administrator  has 
the  real  duty  under  such  conditions  of  precipitating  action.  It  was 
never  truer  than  it  is  today  that  a  modern  factory  building  pays 
not  simply  from  the  process  point  of  view  but  also  from  that  of 
personnel. 

Not  a  little  of  the  seeming  hardship  in  installing  new  equipment 
in  an  old  building  lies  in  the  fact  that  the  cost  is  considered  as  a 
current  expense  rather  than  as  part  of  the  investment.  This 
may  be  an  error  of  attitude  or  of  bookkeeping;  and  it  is  thus 
always  useful  to  remind  the  hesitating  executive  that  the  cost 
of  an  outlay  of  $10,000  on  permanent  improvements  should  show 
on  his  annual  statement  as  the  cost  of  the  interest  charge  on  that 
amount. 

Arguing  from  statistics  of  labor  turnover  is  never  safe;  but  sup- 
pose, for  illustration,  that  the  employment  administrator  finds 
that  the  turnover,  demonstrably  traceable  to  bad  factory  con- 
ditions, is  costing  the  company  $3,000  a  year.  He  can  in  such 
a  case  legitimately  use  the  argument  that  if  that  $3,000,  instead 
of  being  frittered  away  in  turnover  were  used  to  pay  interest  on 
an  investment  in  improved  conditions,  betterments  worth  $60,000 
could  be  adopted;  the  turnover  would  decrease;  and  all  the  other 


112  PERSONNEL  ADMINISTRATION 

benefits  of  good  conditions  would  accrue  immediately  and  perma- 
nently. In  other  words,  the  immediate  out-of-pocket  expense  is 
not  the  only  consideration.  We  have  to  bear  in  mind  that  in 
sound  business  thinking  today  working  conditions  which  are  right 
are  an  essential  part  of  the  initial  investment. 

Fire. — Inspection  of  the  entire  physical  equipment  in  order 
to  assure  adequate  protection  to  the  property  against  loss  by 
fire  is  usually  taken  in  hand  by  the  insurance  companies;  and 
in  some  cases  also  by  local  and  state  authorities.  What  concerns 
the  employment  administrator,  therefore,  is  the  risk  to  life 
that  may  exist.  The  two,  of  course,  cannot  and  need  not  always 
be  sharply  separated;  it  is  simply  that  the  point  of  view  of  the 
conservation  of  human  values  is  constantly  emphasized  in  the 
work  of  this  department. 

Of  prime  importance  is  the  question  of  exits.  These  should 
be  of  fire-proof  material,  whether  within  or  outside  the  factory 
building.  Failing  that,  they  should  be  contained  in  a  fireproof 
tower.  Where  more  than  ten  workers  are  employed  on  a  floor 
there  should  be  at  least  two  exits,  located  at  opposite  ends  of  the 
room;  and  no  exit  should  be  more  than  150  feet  from  the  farthest 
work  point  in  buildings  protected  by  sprinklers,  or  100  feet  in 
buildings  not  so  protected.  The  treads  should  be  at  least  ten 
inches  wide  with  a  rise  of  not  more  than  seven  and  three-quarters 
inches  to  a  step.1  The  width  of  the  stairway  should  depend  upon 
the  number  of  people  who  must  use  it,  but  it  should  never  be  less 
than  forty-four  inches.  There  should  be  hand  rails  on  both  sides. 
It  is  important  to  be  sure  that  exits  do  not  debouch  into  blind 
alleys,  or  locked  basements,  or  other  places  where  people  might 
be  trapped  and  smothered.  They  should  lead  either  to  the  street 
or  to  a  fireproof  passageway  leading  to  the  street,  such  passage- 
way to  have  a  width  not  less  than  the  aggregate  width  of  the 
stairways  leading  to  it. 

Exit  doors  should,  of  course,  open  outward ;  should  be  unlocked 
during  working  hours;  and  be  equipped  with  the  type  of  latch 
used  in  theater  exits  in  which  there  is  a  metal  rod  across  the  en- 
tire door  at  the  height  of  the  waist,  which  is  attached  to  the  latch 
and  which  when  pushed  down  releases  the  latch.  Aisles  to  exits 
should  be  at  least  four  feet  wide  and  should  at  all  times  be  unob- 

1  NEW  YORK  STATE  INDUSTRIAL  COMMISSION.  Industrial  Code,  with 
Amendments,  Additions  and  Annotations  to  Aug.  1,  1918.  Albany,  N.  V., 
pub.  by  Com.,  1918. 


STANDARDS  OF  PHYSICAL  WORKING  CONDITIONS      113 

structed  by  trucks  or  materials.1  Exits  should  be  clearly  marked 
by  signs  in  languages  familiar  to  the  occupants  of  the  room  by 
day,  and  by  red  electric  lights  by  night.  These  signs  should 
always  be  kept  clean  and  bright. 

Monthly  fire  drills  are  frequently  required  by  law;  and  if  they 
are  not,  they  should  be  adopted  as  standard  practice.  There 
should  be  fire  alarm  bells  which  will  give  all  workers  the  fire  sig- 
nal; and  upon  hearing  it  they  should  (according  to  previous 
instructions)  proceed  to  the  assigned  exits.  If  the  drill  is  held 
during  working  time,  it  is  essential  that  piece  workers  be  paid 
for  the  time  lost;  and  it  is  assumed  that  week  workers  will  be. 
There  should  be  every  inducement  for  the  faithful  carrying-out 
of  a  complete  evacuation  of  the  building  at  these  monthly  drills. 
The  location  of  the  fire  box  and  the  emergency  fire  apparatus  in 
each  room  or  department  should  be  known  to  all,  as  well  as  the 
methods  of  utilizing  them.  Especially  where  the  nature  of  the 
process  or  material  makes  a  sudden  conflagration  likely,  there 
should  be  sufficient  hand  extinguishers,  pails  of  sand  or  other 
effective  means  at  hand  which  the  workers  know  how  to  use. 
Maximum  protection  is  only  attained  where  a  plant  fire  depart- 
ment is  trained  efficiently  in  the  use  of  the  apparatus,  and  where 
the  interest  of  all  in  reducing  the  fire  hazards  has  been  aroused. 

Valuable  preventive  work  can  be  done  by  providing  adequate 
fireproof  containers  for  waste,  scrap  and  rubbish,  and  by  seeing 
to  it  that  these  are  emptied  and  the  contents  safely  disposed 
of  at  regular  intervals.  Special  problems  arise  in  the  handling 
of  combustibles  and  explosives,  which  are  usually  covered  by  the 
regulations  of  the  underwriters. 

"In  summary,  we  emphasize  here  what  is  true  of  every  item  of 
working  conditions:  Some  one  executive  should  be  assigned  to 
the  task  of  overseeing  the  work  of  fire  prevention  and  reduction  of 
hazards  to  life  and  property.  Then  and  only  then  will  these  matters 
receive  the  constant  and  systematic  attention  they  deserve. 
The  allocation  of  responsibility  with  authority  is  the  beginning  of 
effective  executive  action, 

Accident. — In  the  previous  chapter  we  have  dwelt  upon  a 
safety-first  program  and  in  that  connection  have  mentioned  many 
of  the  points  which  must  be  considered  in  a  survey  of  plant  con- 

1  For  careful  study  of  aisles,  especially  in  relation  to  crowding,  see  PETER 
SPENCE,  M.  E.,  in  The  Bulletin  of  the  New  York  State  Industrial  Com- 
mission, v.  4,  pp.  68-9,  Jan.,  1919. 
8 


114  PERSONNEL  ADMINISTRATION 

d  it  ions  which  looks  to  the  establishment  of  standard  conditions 
of  safety.  There  must,  of  course,  be  proper  safety  organization, 
executive  and  educational,  throughout  the  plant. 

But  we  are  here  concerned  with  those  physical  conditions  and 
hazards  to  which  special  attention  must  be  paid  if  the  plant  itself 
is  to  be  as  safe  as  possible.  We  shall  therefore  consider  briefly 
the  familiar  hazards. 

Elevators  and  elevator  equipment  require  special  attention. 
Elevators  should  operate  in  fireproof  shafts,  protected  by  spring 
bumpers  at  top  and  bottom.  The  car  should  be  enclosed  on 
all  sides  and  on  top  by  strong  steel  grilling  and  should  carry 
an  automatic  locking  device  to  be  used  when  the  car  is  being 
loaded,  or  when  the  operator  leaves  the  car.  The  gates  to  the 
shaft  should  cover  the  entire  opening  at  each  floor,  preferably 
with  a  fireproof  door  which  can  be  unlocked  from  the  outside 
only. 

Belting,  especially  high-speed,  overhead  transmission  belting, 
should  be  equipped  with  shifting  devices  having  automatic  locks 
so  that  belts  cannot  work  back  on  to  the  wheels  and  start  the 
machinery.  The  safest  method  of  fastening  belting  together  is 
to  glue  the  joints;  the  most  dangerous  is  to  use  steel  fasteners. 
It  is  important  that  there  be  either  a  direct  method  of  stopping 
belting  in  each  room  or  direct  communication  to  the  engine  room 
so  that  power  can  be  at  once  turned  off  if  an  accident  has  occurred 

Machines  or  wheels  revolving  at  a  rapid  rate  should,  especially 
if  there  are  projections  from  their  surface,  be  enclosed  in  a  sta- 
tionary guard.  Exposed  gears,  sprockets  and  chains  should 
usually  be  covered  with  steel  wire  mesh  or  solid  steel  casing. 
Circular  saws,  emery  and  all  types  of  abrasive  wheels  should  be 
enclosed  just  as  fully  as  the  proper  execution  of  the  work  allows. 
Calendering  operations  of  all  sorts  require  guards  to  prevent 
hands  and  clothing  from  being  caught  in  the  revolving  rolls. 
On  all  such  machines  the  guards  should  be  painted  a  conspicuous 
color;  they  should  be  strong  enough  to  hold  under  the  severest 
conditions;  they  should  be  removable,  but  usually  only  by  the 
machinist  who  repairs  the  machinery. 

Punch  and  drill  presses  of  all  sorts  and  hydraulic  cutting  ma- 
chines are  a  grave  source  of  danger  unless  so  arranged  that  the 
worker  must  remove  both  hands  from  the  danger  zone  before  the 
machine  operates. 

Floors  are  a  hazard  if  they  are  splintery,  slippery  or  uneven. 


STANDARDS  OF  PHYSICAL  WORKING  CONDITIONS     115 

Floors  wet  with  oil  or  water  can  be  made  safe  by  proper  covering 
of  rubber  matting,  wooden  gratings,  and  by  proper  drainage. 
Obstacles  on  the  floor  such  as  tools,  materials,  upturned  nails, 
etc.,  over  which  the  worker  may  fall  are  usually  the  result  of 
careless  housekeeping,  and  are  avoidable.  Truck  handles  which 
project  into  aisles  are  a  fruitful  if  minor  cause  of  injury,  which 
can  be  remedied  by  attaching  a  steel  spring  holder  to  the  truck 
itself,  in  which  the  handle  can  be  held  securely  upright  out  of 
everybody's  way. 

The  gauging  of  the  speed  of  fly  wheels  and  exhaust  fans  of  all 
sorts  is  important  in  the  light  of  the  number  of  explosions  of  such 
wheels  which  have  been  due  to  their  running  at  higher  than  pre- 
scribed speed.  The  normal  revolutions  per  minute  should  be 
clearly  posted  beside  each  wheel  and  a  reading  of  the  speed  gauge 
will  then  make  comparison  and  regulation  an  easy  matter. 

Ladders  should  be  used  with  great  care.  The  only  safe  equip- 
ment is  specially  designed  bases  for  the  feet  of  the  ladder,  which, 
depending  on  the  material  of  the  floor,  should  have  either  steel 
pointed  feet,  inverted  hollow  rubber  bases,  or  some  other  non- 
slip  device.1 

Other  details  which  require  constant  watchfulness  include  the 
protection  of  workers  in  the  factory  yard  from  moving  freight 
cars,  dangers  incident  to  oiling  machinery  in  motion,  dangers  of 
electric  shock  at  switch  boards,  special  hazards  to  the  eye, 
hazards  of  open  pits  and  vats,  of  travelling  cranes  and  falling 
objects,  of  hot  pipes  and  boilers  located  too  nearly  under  the 
work  places.  And  finally  it  must  be  remembered  that  in  addition 
each  industry  has  its  own  special  hazards. 

The  following  general  rules  of  standard  practice  can  be  safely 
laid  down: 

Make  factory  equipment  as  "fool-proof"  as  possible.  Acci- 
dents occur  not  when  men  are  alert  against  a  hazard  "that  any 
man  in  his  senses  simply  could  not  get  hurt  from,"  as  managers 
so  often  put  it.  Accidents  happen  in  those  wayward  moments 
when  attention  has  wandered,  fatigue  set  in,  darkness  come  on, 
or  a  fellow  worker  or  truck  has  bumped  into  the  employee.  And 
it  is  against  such  moments  that  the  protective  devices  are  needed. 

Have  adequate  first  aid  kits  available,  near  enough  to  the  work 
place  so  that  they  will  be  used. 

1  See  The  Principles  and  Practice  of  Safety,  National  Safety  Council^ 
Chicago,  1919,  as  well  as  other  publications  of  this  Society. 


116  PERSONNEL  ADMINISTRATION 

Have  someone  in  each  working  group  or  department  trained  to 
administer  first  aid.  But  do  not  consider  this  person  as  substi- 
tute for  a  doctor.  Call  the  doctor  at  once.  Meanwhile,  try  to 
restore  breathing,  stop  bleeding  and  make  the  patient  comfort- 
able. Use  a  solution  of  iodine  freely.  It  prevents  infection, 
is  healing  and  cleansing. 

Have  a  pleasant,  well-equipped,  centrally  located  first-aid  room 
with  a  trained  nurse  in  attendance  as  much  of  the  time  as  the  size 
of  the  plant  and  character  of  the  work  requires. 

Have  some  one  executive  responsible  for  the  prevention  of 
accidents  and  the  maintenance  and  installing  of  all  accident  pre- 
vention equipment. 

Ventilation,  Heating  and  Humidity. — The  problem  of  venti- 
lation is  to  keep  the  air  fresh,  uncontaminated  and  in  motion. 
The  problem  of  heating  is  to  keep  the  air  at  a  comfortable  tem- 
perature. The  problem  of  humidity  is  to  keep  the  proportion 
of  moisture  in  the  air  within  certain  healthy  limits;  otherwise 
neither  adequate  ventilation  nor  good  heating  will  give  satisfac- 
tory results.  It  is  difficult  to  state  convincingly  in  terms  of  the 
workers'  health  or  of  output,  the  vital  importance  of  giving 
proper  attention  to  these  three  closely  related  problems.  Recent 
studies'  indicate  that  neglect  of  them  can  mean  a  reduction  in 
output  as  high  as  twelve  per  cent.;  and  can  result  in  irregular 
attendance,  sickness  and  headaches  which  indirectly  contribute 
further  to  decreased  efficiency. 

It  is  occasionally  helpful  to  remember  that  man  is  a  "domes- 
ticated higher  mammal."  It  is  equally  helpful  to  reduce  the 
matter  to  even  simpler  terms  in  order  to  get  an  adequately 
scientific  point  of  view.  Man  is  also  a  physico-chemical  engine; 
and  his  body  functions  properly  only  under  definitely  prescrilxxl 
conditions  of  external  surroundings  and  internal  normality. 
With  this  in  mind  when  evaluating  working  conditions,  there  will 
almost  automatically  l>e  created  an  outlook  which  appreciates 
the  significance  of  having  plant  equipment  always  right. 

In  regard,  first,  to  ventilation,  the  removal  of  the  grosser  con- 

1  Great  Britain.  Industrial  Fatigue  Research  Board.  Influence  of 
Hours  of  Work  and  of  Ventilation  on  Output  in  Tinplate  Manufacture. 
London,  H.  M.  Stationary  Off.,  1919,  p.  29. 

Sec  also  Hill,  l.i  <in:ini.  Atmospheric  Conditions  and  Efficiency, 
Manchester  University  Press,  1919. 


STANDARDS  OF  PHYSICAL  WORKING  CONDITIONS      117 

laminations  must  be  provided  tor.  Fumes,  vapors,  organic 
and  inorganic  dust,  should  be  eliminated  at  the  source  by  the 
installation  of  adequate  exhaust  pipes  with  hoods  set  as  closely 
as  possible  over  the  point  where  the  contamination  is  generated. 
The  size  of  the  exhaust  pipes  and  the  speed  of  the  fan  which 
creates  the  motion  are  matters  requiring  the  most  careful  tech- 
nical study,  since  upon  these  factors  depends  the  thoroughness 
of  the  exhaustion.1 

The  provision  of  fresh  air,  properly  conditioned,  will  usually 
in  the  larger  plants  require  some  artificial  ventilation.  In  any 
case  the  following  points  should  be  observed: 

Each  individual  requires  at  least  300  cubic  feet  of  free  air  space  ; 
and,  depending  on  the  character  of  the  work,  may  require  as  high 
as  1,000  cubic  feet.  Since  he  breathes  in  between  250  and  350 
cubic  feet  of  air  in  a  day  of  eight  hours,  it  is  safer  that  two  or 
three  times  that  much  new  air  should  be  supplied  during  working 
hours. 

All  air  supplied  should  be  free  of  dust,  bacteria  and  other 
contaminations. 

Ample  allowance  should  be  made  for  the  consumption  of  air 
by  gas  or  oil  used  in  the  room,  and  additional  ventilation  be 
provided  to  offset  this  consumption. 

Rapid  air  currents,  that  is,  drafts,  should  be  avoided.  Yet  it  is 
one  of  the  cardinal  points  of  good  ventilation  that  there  be  a  free 
movement  of  air.  Experiments  demonstrate  that  the  same  air 
can  be  used  again  and  again  if  only  it  is  kept  circulating. 

"Excessive  heat,  vapor  and  injurious  substances  arising  from 
manufacturing  process  or  other  causes  require  to  be  locally 
removed." 

"All  toilets,  lockers  and  other  rooms  of  similar  character 
require  positive  exhaust  ventilations."2 

All  heating  surfaces  should  be  located  and  arranged  so  that 
they  cause  no  discomfort  to  workers. 

All  hot  surfaces  which  it  is  not  essential  to  expose  should  be 


ERSKINE,  LILLIAN.     Standardization  of  Working  Essentials,  A  nnals, 
Am.  Acad.,  v.  71,  p.  86-91,  May,  1919. 

See  also  KENT,  WILLIAM.     Heating  and  Ventilation.     (In   Mechanical 
Engineer's  Pocket-book,  9th  ed.,  p.  681-716.) 

2  Requirements  and  Standards  upon  Heating  and  Ventilation.  U.  S. 
Council  of  National  Defense.  Advisory  Commission.  Committee  on 
Labor.  Wash.  Govt.  Print.  Off.,  1919,  p.  14-15. 


118  PERSONNEL  ADMINISTRATION 

insulated  by  non-conducting  material.  This  should  apply  to 
piping  and  surfaces  of  machinery  as  well  as  to  walls  and  floors 
which  radiate  excessive  heat. 

Whatever  ventilating  system  is  in  use,  a  periodic,  thorough 
airing  out  of  the  workroom  is  valuable — before  work  starts 
in  the  morning  to  remove  the  "stuffiness,"  in  the  middle  of  the 
morning,  at  noon  and  in  the  middle  of  the  afternoon. 

Executive  responsibility  for  ventilation  should  be  clearly  fixed ; 
yet  the  maximum  possible  freedom  should  be  left  to  the  workers 
in  each  room  to  determine  the  conditions  under  which  they  will 
work.  If  the  conditions  as  so  determined  are  manifestly  un- 
wholesome, the  remedy  is  not  in  a  display  of  authority  but  in 
education  of  the  group  along  familiar  hygienic  lines. 

The  amount  of  heat  required  depends  largely  upon  the  char- 
acter of  the  work.  For  active  shop  work,  where  the  whole 
body  is  engaged,  58  to  60  degrees  F.  is  found  to  be  satisfactory; 
at  bench  work  and  other  less  active  work  65  degrees  F.  is  suitable; 
while  at  clerical  work  68  to  70  degrees  F.  is  required.  In  order 
to  assure  uniformity  and  regular  control,  an  automatically 
recording  thermometer  should  be  in  operation  in  each  room  and 
should  be  checked  up  at  least  twice  a  day  by  the  person  in  charge 
of  ventilation  and  heating. 

But  the  record  of  temperature  will  give  a  true  picture  of  con- 
ditions only  when  correlated  with  a  record  of  humidity.  This 
correlation  can  be  easily  obtained  by  the  use  of  a  hygrometer 
which  shows  the  per  cent,  of  humidity  in  relation  to  temperature. 
From  the  standard  hygrometrical  tables  it  is  then  easy  to  dis- 
cover whether  sufficient  moisture  exists.1 

1  "In  winter  the  dampest  days  are  unmistakably  the  times  of  greatest 
efficiency.  The  reason  is  twofold.  In  general,  the  temperature  rises  at 
times  of  excessive  humidity,  and  this  in  itself  is  favorable.  Moreover,  the 
air  when  taken  into  the  house,  does  not  need  to  be  warmed  so  much  as 
under  other  conditions,  and  thus  it  remains  comparatively  moist. 

"In  the  spring  and  fall,  when  the  temperature  ranges  from  freezing  to 
70°,  with  an  average  of  about  50°  F.,  the  best  work  is  performed  with  a 
relative  humidity  of  about  75  per  cent.  In  other  words  neither  the  dry  nor 
the  wet  days  are  the  best.  The  summer  curve  (of  output)  is  the  most  com- 
plex of  the  three.  It  rises  first  to  a  maximum  at  60  or  65  per  cent.,  then 
falls  and  once  more  rises  to  a  higher  maximum.  We  conclude  that  with  an 
average  temperature  of  65°  to  70°  a  relative  humidity  of  about  60  per  cent, 
is  desirable."  HCNTINQTON,  ELLSWORTH.  Civilization  and  Climate,  1915, 
pp.  80-87. 


STANDARDS  OF  PHYSICAL  WORKING  CONDITIONS     119 

Various  devices  for  artificial  humidifying  are  on  the  market; 
but  for  a  plant  that  can  attack  the  whole  ventilating  problem  at 
once  it  is  unquestionably  desirable  to  install  an  air  conditioning 
apparatus  which  in  the  same  mechanism,  washes,  warms  and 
moistens  the  air  which  is  distributed.  It  is  only  where  the  nature 
of  the  product  or  process  requires  excessive  moisture  that  some 
supplementary  humidifying  may  be  needed. 

Ordinarily,  however,  our  factories  and  office  buildings  do  not 
give  us  moist  enough  air.  The  heat  dries  the  mucous  membrane 
and  leaves  it  in  a  condition  of  lowered  efficiency  for  resisting 
germs.  Managers  are  not  disposed  to  recognize  the  need  for 
adequate  humidity;  but  the  use  of  a  hygrometer  for  a  few 
weeks  will  usually  show  convincingly  that  most  plants  should 
make  some  specific  provision  for  moistening  their  heated 
workrooms. 

Lighting. — Deficiencies  in  factory  lighting  are  estimated  by 
illuminating  engineers  as  accounting  for  as  high  as  a  twenty  per 
cent,  loss  in  production  where,  as  in  textile  plants,  the  work  must 
be  closely  scrutinized.  Bad  lighting  directly  contributes  to  eye 
strain,  headache  and  nervous  irritation.  We  confront  here  a 
problem  where  correction  depends  as  much  upon  an  expendi- 
ture of  thought  as  of  money.  Adherence  to  a  few  fundamental 
principles  can  help  greatly  to  eliminate  the  worst  lighting 
difficulties. 

There  are  three  points  to  consider  regarding  both  natural  and 
artificial  lighting;  its  sufficiency,  its  continuity,  its  diffusion. 

The  minimum  amount  of  light  required  at  different  kinds  of 
work  has  been  fairly  well  standardized,  and  the  table  adopted 
by  the  Illuminating  Engineering  Society  is  widely  available.1 
In  order  to  secure  daylight  sufficient  to  conform  to  those  stand- 
ards, the  following  conditions  must  prevail: 

Windows  should  be  as  large  as  possible,  provided  they  do  not 
create  a  glare;  and  should  be  so  located  that  artificial  light  is 
necessary  only  when  it  would  be  naturally  used.  Natural 
light  is  the  most  normal  and  effective  for  the  human  eye.  Other 

1  See,  for  example,  U.  S.  Council  of  National  Defense,  Advisory  Com- 
mission. Code  of  Lighting  for  Factories,  Mills  and  Other  Work  Places. 
Wash.  Govt.  Print.  Off.,  1918,  p.  7. 

The  Principles  and  Practice  of  Safety,   p.    11. 

CLEWELL,    C.   E.     Natural  Lighting.     Wash.,   U.   S.   War  Industries 
Board,  Employment  Management  Section,  1918,  10  p.     Typewritten, 


120  PERSONNEL  ADMINISTRATION 

things  being  equal,  it  is  to  be  preferred  and  sought  as  a  source  of 
workroom  illumination. 

The  top  sash  of  the  windows  and  all  basement  windows  should 
be  supplied  with  ribbed  glass  to  increase  the  refraction  of  light 
into  the  center  of  the  room. 

Even  though  a  translucent  glass  over  the  entire  window  might 
give  better  diffusion  of  the  light,  regard  for  the  worker  as  a 
human  being  demands  that  the  window  panes  at  the  level  of  the 
face  be  of  transparent  glass  so  that  the  worker  can  see  out  of 
doors.  Minor  as  this  point  may  seem,  it  is  fundamental  to  the 
maintenance  of  a  cheerful  factory  atmosphere. 

Where  curtains  must  be  drawn  to  remove  the  glare  due  to 
direct  rays  of  the  sun,  the  curtain  should  pull  up  from  bottom 
rather  than  down  from  the  top.  This  provides  shade  near  the 
window  and  leaves  the  middle  of  the  room  still  supplied  with 
light  from  above. 

Windows  should  be  washed  at  the  regular  necessary  intervals. 

Reflecting  surfaces  outside  the  plant,  as,  for  example,  an  ad- 
joining building  or  another  section  of  the  same  building  across 
a  narrow  court,  should  be  painted  a  light  color  to  increase  the 
supply  of  light  within  the  room. 

Reflecting  surfaces  inside  the  plant — walls,  ceilings  and  where 
practical  the  machinery  as  well — should  be  painted  a  light  color 
(preferably  a  soft,  light  green)  to  increase  the  light.  Below  the 
wainscoting,  walls  can  be  a  darker  color,  in  order  to  rest  the  eyes. 

Work  places,  benches  and  machinery  should  be  placed  at 
right  angles  to  the  window  so  that  the  light  comes  over  the 
worker's  shoulder  on  to  his  work.  The  persistent  ignoring  of  this 
simple  but  fundamental  rule  probably  accounts  for  existing  eye 
strain  more  than  any  other  one  factor. 

To  secure  proper  artificial  light,  it  is  important  to  observe  the 
following  principles: 

There  should  be  sufficient  light  for  each  worker  irrespective 
of  his  position  at  his  work,  in  accordance  with  the  standards 
suggested  in  the  above  sources.  Lamps  should  be  fixed  and 
stationary. 

"The  type,  size  and  spacing  of  lamps  and  reflectors  should  be 
determined  with  special  reference  to  the  ceiling  height  and  class 
of  work  in  question."1 

A  system  of  general  overhead  lighting  is  to  be  preferred,  with 

1  Principles  and  Practice  of  Safety,  p.  11. 


STANDARDS  OF  PHYSICAL  WORKING  CONDITIONS     121 

the  use  of  reflectors  which  make  tLe  actual  rays  of  light  from 
the  lamps  semi-indirect  or  wholly  indirect.  The  light  should  be 
strong  enough  and  so  located  as  to  remove  sharp  shadows  and  to 
remove  the  necessity  for  individual  lamps  except  in  special  cases. 

Where  it  is  necessary  to  use  individual  lamps,  it  is  important 
that  opaque  reflectors  be  used  and  so  affixed  that  the  light  does 
not  shine  in  the  worker's  eyes 

Care  should  be  taken  to  avoid  glare  also  from  bright  or  polished 
reflecting  surfaces . 

Lamps  should  be  operated  from  sources  of  supply  which  insure 
continuous  and  steady  light.  The  flicker  of  some  lamps  where 
electricity  is  locally  generated  causes  strain  and  fatigue 

Lamps  and  reflectors  should  be  dusted  and  washed  at  regular 
intervals • 

Emergency  lamps  should  be  provided,  especially  in  passage- 
ways and  exits,  to  assure  reliable  operation  if  for  any  reason 
the  regular  lighting  fails.  Those  lamps  should  be  supplied  from 
sources  wholly  independent  of  the  regular  lighting 

Switches  should  be  so  located  that  "at  least  pilot  or  night 
lights  may  be  turned  on  at  the  main  points  of  entrance."1.  .  .  . 

Here  again,  the  final  word  is:  Make  some  one  executive  respon- 
sible for  these  matters  and  provide  him  with  competent  technical 
assistance  so  that  the  shop's  lighting  may  be  as  effective,  as 
cheerful,  as  scientific  and  as  economical  as  possible.  . 

Noise  and  Vibration. — The  harmful  effects  of  excessive  noise 
and  vibration  are  only  beginning  to  be  realized.  Noise,  espe- 
cially when  it  recurs  frequently  at  irregular  intervals,  requires 
an  adjustment  of  the  worker's  whole  nervous  system  which  is 
taxing  and  wasteful  of  energy.  It  distracts  attention,  creates 
an  irritating  feeling  of  "jumpiness"  and  generally  reduces  the 
equanimity  and  efficiency  of  the  affected  person.  Where  noise 
leaves  off  and  vibration  begins  is  not  always  easy  to  determine. 
The  deciding  factor  is  the  number  of  sound  waves  per  second, 
and  "it  is  difficult  to  determine  whether  or  not  it  is  the  ear  alone 
or  the  whole  body  that  detects  the  sound  in  vibration.  Hence 
the  annoyance  from  sound  is  not  easily  separated  from  the 
nervous  exhaustion  resulting  from  direct  vibration."2 

1  Code  of  Lighting,  etc.,  p.  8. 

2  The  Effects  of  Vibration  in  Structures,  Aberthaw  Construction  Co., 
Boston,  1918.     This  and  the  following  quotations  are  taken  from  this  pio- 
neer and  exceedingly  suggestive  preliminary  study  of  vibration. 


122  PERSONNEL  ADMINISTRATION 

Testimony  is  general  that  severe  vibration  "tends  to  tire  the 
women  and  make  them  nervous,  with  the  result  that  they  become 
irritable  and  inefficient."  "In  the  case  of  women,  it  seemed 
impossible  for  them  to  stand  the  vibration  even  temporarily 
on  account  of  its  serious  effects.  We  believe  that  employees 
working  under  such  conditions  as  we  had  were  not  over  two- 
thirds  efficient."  Other  evidence  might  be  cited  to  the  same 
effect,  but  it  is  sufficient  to  call  attention  to  the  seriousness  of 
the  problem.  The  question  is:  What  can  be  done  about  it? 

The  elimination  of  noise  is  of  course  impossible  under  present 
conditions  in  certain  processes.  Machines  have  not  been  built 
with  an  eye  to  quiet  action,  and  until  machine  builders  attack 
this  problem  the  most  acute  cause  will  remain  untouched. 
Nevertheless,  there  are  certain  things  which  can  be  done. 

The  first  essential  is  to  realize  that  all  unnecessary  noise  should 
be  done  away  with;  where  there  is  the  will,  the  way  will  begin 
to  appear.  The  rubber-tiring  of  all  trucks  is  a  preventive 
measure  of  first  importance.  In  many  plants  it  will  also  help 
to  have  aisles  covered  with  some  sound-deadening  composition, 
such  as  battleship  linoleum.  Where  the  nearby  passage  of  trains 
is  a  noisy  distraction  as  well  as  a  cause  of  vibration,  the  remedy 
is  not  so  easily  at  hand,  although  the  better  constructed  buidings 
have  a  great  advantage  here.  The  use  of  electric  power  drives 
from  local  units  greatly  lessens  lx)th  noise  and  vibration,  and 
has  the  added  value  of  reducing  the  objectionable  flicker  of  the 
daylight  which  a  mass  of  overhead  belting  is  likely  to  create. 

The  elimination  of  vibration  is  fundamentally  a  matter  of 
building  construction.  The  structure  has  to  be  solidly  based, 
and  the  evidence  seems  to  point  more  and  more  to  the  use 
of  reenforced  concrete  as  the  most  non-vibrant  material. 
Where  the  shaking  is  local,  due  to  special  machines,  it  is  some- 
times found  necessary  to  build  separate  foundations  for  these 
machines.  The  use  of  some  type  of  absorl>ent  mat  under 
machines  also  appears  to  Ix;  helpful.  Rubber  mats  and  ground 
cork  mats  as  bases  for  certain  types  of  machines,  as  for  ex- 
ample, power  sewing  machines,  are  found  to  reduce  the  vibration 
appreciably. 

In  the  last  analysis,  however,  it  must  be  admitted  that  the 
problem  of  noise  and  vibration  is  one  which  is  only  newly  being 
studied.  And  until  buildings  are  firmly  anchored  and  sound 


STANDARDS  OF  PHYSICAL  WORKING  CONDITIONS     123 

proof,  and  until  machinery  is  designed  to  work  with  less  pounding 
impact,  the  greatest  advances  cannot  be  made. 

Seating  and  Rest  Rooms. — The  value  of  seats  for  workers 
is  recognized  in  the  legal  provisions  which  several  states  make 
for  women  workers.  But  the  value  is  not  sufficiently  recognized 
for  the  right  type  of  seating  to  be  provided.  The  wooden 
stool,  the  enameled  steel  stool,  the  chair  with  a  flat  board  back, 
are  still  widely  used.  Unfortunately  we  know  of  no  factory 
chair  manufactured  which  conforms  to  scientific  standards. 
This  correct  chair  would  embody  the  following  features;  an 
adjustable  back  with  a  padded  rest  (like  that  on  a  stenographer's 
chair)  to  support  the  worker  immediately  below  the  shoulder 
blades;  an  adjustable  seat  so  that  its  height  from  the  floor  can 
be  regulated — if  made  with  a  revolving  seat  the  chair  should 
have  a  locking  device  to  prevent  motion  when  the  worker  wants 
to  be  stationary;  adjustable  foot  rests;  and  finally  a  cushioned 
seat.  In  short,  a  good  chair  is  one  which  re-enforces  and  sup- 
ports the  body  at  those  places  where  re-enforcement  means  less 
exertion,  better  posture,  and  consequently  a  better  functioning  of 
the  vital  organs. 

Chairs  in  a  factory  are  not  a  luxury  or  a  frill.  To  one  who 
understands  that  we  are  dealing  with  human  beings  who  are 
in  the  first  instance  "physico-chemical  engines,"  it  will  be 
clear  that  energy  is  saved  by  sitting,  which  can  be  better  used 
in  other  directions;  it  will  be  clear  that  to  vary  the  posture  from 
sitting  to  standing,  and  from  standing  to  sitting,  is  restful  and 
conserving  of  strength.  For  this  reason,  the  tradition  that  the 
worker  must  not  be  found  by  his  foreman  sitting  down  must 
go  the  way  of  many  other  time-honored  but  unscientific  notions. 
In  fact,  the  worker  should  be  encouraged  to  sit;  and  there  are 
many  jobs  now  done  standing  which  could  be  done  with  equal 
facility  but  much  less  fatigue  if  suitable  chairs  were  provided. 

The  provision  of  rest  rooms  is  often  required  by  law  where 
women  are  employed,  although  little,  if  anything,  is  specified 
about  the  equipment.  Ideally,  there  should  be  a  clear  separation 
between  dressing  rooms  and  rest  rooms.  The  familiar  practice 
of  simply  providing  benches  in  the  locker  room  is  wholly  in- 
adequate to  meet  the  needs  for  which  a  real  rest  room  is  designed ; 
neither  is  it  sufficient  simply  to  use  a  lunch  room  for  this  purpose. 

Whether  or  not  such  rooms  should  be  available  for  the  men, 
depends  upon  the  purpose  they  are  intended  to  serve.  If  what 


124  PERSONNEL  ADMINISTRATION 

is  desired  is  a  place  to  rest  and  restore  vitality,  then  that  need 
should  dictate  the  requirements.  If  a  noon  meeting  place  and 
social  lounging  room  for  all  employees  is  desired,  the  equipment 
required  is  manifestly  different.  It  is  almost  impossible  to  pro- 
nounce in  general  upon  the  provisions  which  a  factory  should 
make  in  this  direction.  The  only  point  we  wish  to  make  is 
that  if  the  choice  is  for  a  rest  room,  no  one  should  be  ashamed 
of  the  decision;  and  it  is  exactly  as  good  a  business  proposition 
to  have  a  rest  room  for  men  as  it  is  for  women.  It  was  a  scientific 
management  expert  who  wrote  recently  that  from  a  physiological 
point  of  view,  it  would  be  a  good  thing  for  workers  to  recline  at 
full  length  in  the  intervals  between  work.1  His  point  was  that 
the  total  change  in  distribution  of  blood  pressure  which  is  assured 
by  lying  down  is  the  most  effective  recuperative  measure  known. 

Assuming,  therefore,  that  a  corporation,  recognizing  the  value 
of  rest  from  the  physiological  and  business  point  of  view,  wants 
to  provide  a  properly  equipped  resting  place,  what  items  should 
it  consider?  In  the  first  place,  the  location  of  the  rest  room 
should  be  such  that  the  noise,  odor  or  other  effects  of  work  pro- 
cesses reach  it  as  little  as  possible.  The  room  should  be  quiet, 
cheerful,  bright,  clean  and  restful  in  atmosphere,  hangings 
and  furniture.  The  chairs  and  lounges  should  be  comfortable 
and  sufficient  in  number  so  that  the  worker  will  not  have  an 
attack  of  conscience  if  by  occupying  one  for  more  than  five 
minutes  he  deprives  other  workers  of  a  chance  to  sit  at  all. 

Finally,  it  is  an  important  part  of  the  atmosphere  of  the  room 
that  the  employees  should  feel  it  to  be  their  room.  This  feeling 
can  be  achieved  in  various  ways;  but  there  is  nothing  like  re- 
sponsibility to  give  a  genuine  sense  of  proprietorship.  One  way  of 
securing  this  attitude  is  to  have  a  committee  of  workers  to 
administer  this  room,  helping  in  the  selection  of  its  furnishings 
and  in  its  maintenance. 

As  it  works  out  today  some  rest  rooms  are  well  used ;  some  are 
used  at  the  start  and  then  forgotten;  some  are  used  very  little. 
It  is,  of  course,  better  from  every  point  of  view  that  workers  if 
they  want  to  stretch  out  and  sleep  at  noon  (as  many  of  them  do) 
should  sleep  comfortably  on  a  couch  rather  than  on  a  work  bench. 
But  they  must  want  to  use  the  couch  and  they  must  feel  that 
they  are  not  getting  a  substitute  for  more  wages  when  a  rest 
room  is  provided,  if  the  rest  room  is  to  be  a  permanently  used  and 

1  C.i i.iiid ni,  FRANK  H.     Fatigue  Study,  p.  43. 


STANDARDS  OF  PHYSICAL  WORKING  CONDITIONS      125 

appreciated  asset.  And  there  is  no  way  for  the  workers  to  make 
these  decisions  short  of  deliberately  taking  counsel  with  the  manage- 
ment on  the  question  of  instituting  and  using  the  rest  room.  But 
if  the  workers  want  one,  will  use  it  and  will  help  to  take  charge 
of  it,  we  see  every  advantage  in  its  installation. 

The  statement  above  is  underscored  because  it  embodies  a 
principle  about  the  installation  of  all  factory  personnel  equip- 
ment which  although  fundamental,  is  frequently  lost  sight  of; 
the  principle,  namely,  that  the  provision  of  equipment  of  any 
sort  for  people  without  some  simultaneous  attempt  to  create  a  sense 
of  need  and  a  knowledge  by  them  of  methods  of  its  use,  is  neither 
appreciated  nor  in  the  long  run  taken  advantage  of.  Old  fash- 
ioned "welfare  work"  is  in  bad  repute  today  partly  because  the 
workers  were  not  taken  into  the  confidence  of  the  management 
in  its  administration,  and  it  was,  therefore,  regarded  as  a  pater- 
nalistic sop ;  and  partly  because  it  was  conceived  by  workers  as  an 
effort  to  let  "welfare"  take  the  place  of  justice. 

It  should  be  clear  from  what  has  gone  before  that  we  have  no 
interest  in  "welfare  work"  so  conceived.  The  modern  point  of 
view  looks  in  the  direction  of  studying  the  elements  in  the  problem 
of  human  relations  which  must  be  dealt  with  in  order  to  have  the 
factory  operate  efficiently;  and  if  in  pursuit  of  that  end  the  em- 
ployment administrator  has  at  times  to  go  somewhat  afield,  he 
does  this  deliberately  as  an  organic  part  of  his  work  of  sound 
management  and  not  with  a  motive  of  philanthropy.  The  pro- 
vision of  right  working  conditions  is  in  no  sense  "welfare  work.'1 
It  is  a  plain  business  and  human  necessity.  And  until  corpora- 
tions are  prepared  to  put  their  houses  in  order  in  these  obvious 
matters,  there  is  little  use  in  launching  into  projects  such  as  profit 
sharing  schemes  or  other  complex  proposals  which  fundamentally 
presuppose  an  efficiently  managed  production  organization  in  a 
physically  well  equipped  plant. 

Lunch  Rooms. — In  plants  located  at  a  distance  from  stores, 
restaurants,  or  the  homes  of  a  majority  of  the  workers,  there  is 
much  to  be  said  for  making  some  lunch  room  provision  a  part  of 
the  business  equipment  of  the  shop.  Such  provisions  may  as  a 
minimum  be  confined  to  a  place  where  workers  may  warm  up 
their  food  and  eat  their  lunches  away  from  the  work  places;  or 
they  may  be  elaborate  cafeterias  and  restaurants. 

Cleaning. — The  reaction  of  competent  factory  housekeeping 
upon  the  appearance  and  morals  of  a  working  force  is  in  the  long 


126  PERSONNEL  ADMINISTRATION 

run  of  great  benefit.  Workers  dress  better,  they  are  more  cheer- 
ful, they  are  more  careful  in  the  disposal  of  waste  and  rubbish 
in  plants  where  the  watchword  is  cleanliness.  Nor  is  this  an 
impossible  ideal  for  any  plant  to  hold  in  view,  it  matters  not  how 
dirty  the  processes  may  be.  This  is  another  case  where  regular 
executive  attention  to  the  problem  is  the  price  of  good  results. 
From  the  experience  of  plants  where  the  housekeeping  has  thus 
been  made  satisfactory  the  following  hints  can  be  learned : 

There  must  be  a  separate  cleaning  staff  under  a  cleaning  fore- 
man. This  staff  should  get  an  hourly  rate  of  pay  high  enough  to 
assure  a  regular  and  a  conscientious  force.  The  old  notion  that 
cleaners  should  get  the  lowest  rate  in  the  shop  is  the  product  of  a 
time  when  bacteria  were  unknown  and  antiseptic  methods  of 
cleaning  unheard  of.  It  must  be  remembered  that  cleanliness 
involves  not  simply  the  removal  of  dirt — misplaced  matter;  it 
involves  also  the  minimizing  of  harmful  germs. 

Methods  of  dry  sweeping  should  give  way  to  some  method 
which  lays  the  dust  before  it  is  collected.  There  are  several  good 
dust  layers  on  the  market;  and  even  the  use  of  wet  sawdust, 
except  for  the  fire  hazard  in  storing  dry  sawdust,  is  better  than 
dry  sweeping.  Vacuum  cleaners  are  excellent  where  the  nature 
of  the  work  permits  their  use.  Sweeping  should  be  done  as 
much  as  possible  out  of  working  hours. 

There  should  be  sufficient  fireproof  containers  for  waste 
material  and  rubbish,  and  these  should  be  emptied  at  frequent 
intervals. 

There  should  be  a  regular  schedule  for  cleaning,  at  the  necessary 
intervals,  the  workrooms,  toilets,  walls,  ceilings,  windows,  lamps, 
reflectors,  halls  and  stairways,  yard,  etc. 

Drinking  Water. — The  value  of  an  adequate  supply  of  pure, 
cool  drinking  water  will  be  quickly  recognized,  if  we  remember 
the  physico-chemical  aspect  of  our  problem.  "Water  is  a  nat- 
ural constituent  of  the  body  and  is  to  be  considered  as  a  food, 
though  not  in  the  sense  that  it  liberates  energy.  It  aids  in  the 
absorption  of  food  and  carries  away  waste.  It  diminishes  fatigue. 
It  regulates  body  temperature  and  acts  as  a  distributor  of  heat. 
And  there  seems  to  be  no  question  but  that  the  drinking  of  water 
lessens  alcoholism."1 

1  DARLINGTON,  DR.  THOHAS.  Present  Scope  of  Welfare  Work  in  the 
Iron  and  Steel  Industry.  Pamphlet,  N.  Y.  Iron  and  Steel  Institute, 
1914,  p.  6. 


STANDARDS  OF  PHYSICAL  WORKING  CONDITIONS     127 

The  first  essential  in  having  a  good  supply  of  water  is  to  be 
sure  the  source  is  uncontaminated.  Apart  from  the  considera- 
tion of  initial  expense,  it  is  clearly  the  most  desirable  standard 
practice  to  filter  the  water,  to  cool  it  to  50°  by  ammonia  or  other 
refrigerating  process,  and  to  distribute  it  throughout  the  plant 
in  pipes  covered  with  non-conducting  material  to  bubbler 
fountains  conveniently  located  so  that  there  is  one  fountain  for 
every  forty  workers.  The  fawcets  at  these  bubblers  should  be 
double;  one  from  which  a  glass  can  be  filled,  and  the  other  a 
nozzle  which  will  throw  up  a  sufficient  jet  of  water  so  that  one 
can  drink  two  inches  above  the  opening.  There  are  several 
satisfactory  bubbler  nozzles  on  the  market;  but  one  which  is 
especially  good  comprises  simply  a  three  inch  circle  of  quarter- 
inch  nickel  pipe  horizontally  fixed,  in  which  there  are  small 
perforations  so  located  that  the  water  flowing  simultaneously 
from  all  the  holes  meets  in  one  stream  about  two  inches  above 
the  center  of  the  circle  of  pipe.  The  water  which  is  not  drunk 
falls  back  without  touching  the  pipe  and  there  is  no  occasion  for 
the  drinker's  lips  to  come  in  contact  with  the  nozzle. 

Where  the  process  makes  it  difficult  for  the  worker  to  leave 
his  bench,  some  companies  have  wisely  found  it  beneficial  to 
have  an  attendant  pass  through  the  room  every  little  while 
with  water  in  individual  drinking  cups — much  as  the  theater 
ushers  pass  water.  They  realize  that  it  is  almost  impossible  for 
workers  to  drink  too  much  water;  and  therefore  the  more  easy 
and  attractive  its  drinking  is  made,  the  more  it  will  be  drunk 
and  the  better  will  be  their  health. 

Sanitary  Equipment. — Physiologically  the  provision  of  ade- 
quate, clean  and  attractive  toilets  is  of  notable  importance, 
especially  because  of  what  we  know  about  the  relation  of  their 
condition  to  constipation  and  venereal  diseases.  The  law 
usually  requires  a  closet  to  every  twenty  workers;  but  this  is  a 
minimum  provision.  Other  desirable  conditions  to  observe  are 
the  following: 

The  toilet  rooms  for  men  and  women  should  be  completely 
separate  from  each  other,  and  from  the  work  rooms;  and  should 
be  clearly  marked  "Men,"  or  "Women."  There  should  be 
screens  before  the  entrances  of  these  rooms  which  effectively 
conceal  their  interior  from  outside  view. 

Toilets  should  be  adequately  lighted  at  all  times,  and  there 
should  be  adequate  ventilation  from  outside  the  building. 


128  PERSONNEL  ADMINISTRATION 

The  room  should  be  kept  at  a  temperature  of  not  less  than 
60°F.  during  working  hours. 

Floors  of  toilet  rooms  should  be  of  some  moisture-proof, 
smooth  material;  and  walls  should  be  kept  covered  with  clean, 
light  colored,  non-absorbent  paint  or  other  moisture-proof 
material.1 

There  should  be  free  provision  of  toilet  paper;  and,  especially 
where  employees  have  anything  to  do  with  the  handling  of  food, 
nearby  basins  in  which  to  wash  the  hands. 

There  should  be  individual  closets  with  wooden  seats,  with 
bowls  of  vitreous  china  or  other  approved  material  and  adequate 
pressure  for  flushing.  Each  closet  should  occupy  a  separate 
compartment  and  be  provided  with  a  door  opening  outward. 

In  conclusion,  the  proper  maintenance  of  toilets  should  be 
referred  to,  as  it  unquestionably  offers  occasional  difficulties. 
In  our  experience  these  difficulties  are  not  to  be  permanently 
overcome  until  managers  realize  the  nature  of  the  problem.  The 
abuse  of  toilet  facilities  occurs  most  frequently  where  workers 
are  unfamiliar  with  their  proper  use.  It  cannot  be  too  strongly 
emphasized  in  this  as  in  other  connections,  that  in  those  factories 
where  workers  are  recent  immigrants  they  are  predominantly 
peasants.  They  are  from  rural  regions  of  southern  and  eastern 
Europe  and  have  never  seen  or  heard  of  modern  plumbing  ar- 
rangements. Accustomed  as  they  are  to  the  crudest  sort  of 
sanitary  conveniences,  they  assume  that  they  can  treat  water- 
closets  in  impossible  ways.  The  problem  is  an  educational  one. 
Many  large  firms  find  it  worth  while  to  have  an  attendant  always 
on  hand  in  the  toilet  rooms.  Where  there  is  a  medical  staff,  the 
method  of  operation  and  proper  use  of  all  modern  plumbing 
devices  should  be  explained  in  the  course  of  the  educative  work 
in  personal  hygiene.  For  managers  to  make  existing  or  past 
abuses  of  the  toilet  or  washing  facilities  an  excuse  for  continuing 
old  and  unsanitary  equipment,  is  to  place  resj>onsil>ility  on  the 
wrong  shoulders.  The  rank  and  file  of  workers  are  not  inherently 
wanton  or  vicious  or  destructive  in  these  matters;  it  is  more 
often  the  case  that  they  do  not  know  any  better  and  have  never 
had  the  chance  to  learn. 

Standard  practice  in  washing  facilities  depends  in  part  upon 

1  Soo  the  standards  rvquiivd  in  tin-  rxcHlrnt  IcanVt  issue*!  by  the  Industrial 
Welfare*  Conunisnion  of  California,  Order  No.  4,  Amended,  under  daU;  of 
Jan.  7,  1919. 


STANDARDS  OF  PHYSICAL  WORKING  CONDITIONS     129 

the  nature  of  the  work.  There  is  no  doubt  from  a  physiological 
point  of  view  but  that,  where  employees  leave  work  at  the  end 
of  the  day  wet  through  with  perspiration,  it  is  good  hygiene 
for  them  to  take  a  shower  bath  before  going  out  doors.  The 
fact  that  thousands  of  workers  have  done  and  still  do  otherwise 
does  not  lessen  the  hazard. 

"The  man  who  leaves  the  plant.  .  .  saturated  with  sweat,  is  80 
per  cent,  more  liable  to  respiratory  disease  during  seven  months  of  the 
year  than  the  worker  who  has  washed  up  and  changed  to  street  clothes 
in  a  properly  heated  room."1 

"Shower  baths  affect  the  circulation  of  the  blood,  not  only  in  the  skin 
but  in  the  whole  body.  They  produce  a  redistribution  of  the  blood  in 
the  body,  and  for  the  time  being  there  is  an  actual  change  in  the  blood 
itself.  Cold  showers  increase  muscular  capacity  for  work.  Showers 
eliminate  more  rapidly  the  products  of  waste  and  so  constitute  one  of 
the  methods  of  relieving  fatigue."2 

Where  the  character  of  the  work  calls  for  them  it  is,  therefore, 
valuable  to  furnish  showers  and  even  more  valuable  to  encourage 
their  use  by  legitimate  educational  methods.  Several  attendant 
conditions  must,  however,  be  assured  if  the  use  of  the  baths  is  to 
be  satisfactory  and  permanent. 

There  should  be  a  warm  shower  bath  room — one  kept  at  all 
times  of  use  at  80°.  This  room  should  adjoin  the  dressing  room, 
should  be  clean,  well  lighted  and  well  ventilated.  The  floor  of 
this  room  should  be  covered  with  removable  rubber  matting, 
wooden  grating  or  some  other  material  to  keep  the  feet  off  the 
cold  cement. 

Hot  and  cold  water  should  be  provided,  as  well  as  soap. 
Towels  should  be  furnished  by  the  company  upon  deposit  of  five 
cents  and  should  be  laundered  at  least  weekly  at  the  company's 
expense. 

There  should  be  one  shower  to  every  eight  or  ten  workers. 

In  plants  where  the  work  is  less  arduous  but  still  dirty,  the 
installation  of  lavatory  basins  or  enamel  troughs  is  requisite. 
Individual  basins  are,  of  course,  more  expensive  to  install  and 
to  maintain ;  and  if  used  one  basin  to  every  five  workers  is  needed. 
However,  "where  large  numbers  must  be  accommodated,  .  .  . 
where  the  worker  should  strip  to  the  waist  in  order  to  wash 

1  ERSKINE,  LILLIAN,  op.  cit.,  p.  93. 

2  D ARLINGTON,  DR.  THOMAS,  op.  cit.,  p.  7, 

9 


130  PERSONNEL  ADMINISTRATION 

more  thoroughly,  a  satisfactory  substitute  is  a  perforated  pipe, 
conveying  tempered  water,  installed  above  the  middle  of  the 
trough  at  a  height  of  18  to  24  inches.  Stoppers  should  be  pulled 
so  that  all  washing  is  done  in  running  water;  and  a  trough  length 
of  two  feet  to  every  five  workers  is  also  necessary."1  Here 
again  the  provision  of  ground  soap  and  toweling  is  imperative. 
Whether  paper  or  bath  towels  are  to  be  used  will  depend  in 
large  part  on  the  company's  willingness  to  bear  the  added  ex- 
pense of  the  cloth  towels  which  on  the  whole  are  much  to  be 
preferred. 

Under  any  conditions  of  work,  the  hygienic  value  of  washing 
the  hands  before  eating  should  be  appreciated  and  the  necessary 
provision  accordingly  made.  Cleanliness  of  employees  at  work 
spells  self-respect;  it  reduces  the  likelihood  of  disease;  it  helps 
to  assure  bodily  integrity. 

Where  men  chew  tobacco  at  work  it  is  necessary  either  to  make 
some  arrangement  for  cuspidors;  or  else  prohibit  chewing  and 
spitting  altogether.  Promiscuous  spitting  about  the  plant  can 
be  reduced  to  a  minimum  with  a  little  effort;  and  an  important 
adjunct  of  a  clean-up  campaign  is  to  have  on  the  stairways  and 
at  the  necessary  work  places  an  adequate  supply  of  receptacles. 
It  is  also  useful  to  have  all  floor  corners  painted  white.  Gal- 
vanized iron  pans  filled  with  a  solution  of  lysol  or  some  other 
disinfectant,  light  cardboard  boxes  filled  with  sawdust,  boxes 
filled  with  sand — these  are  some  of  the  prevailing  methods  of 
providing  cuspidors.  Care  must  be  exercised  to  have  sanitary 
disposal  of  the  contents,  which  should  be  removed  daily  and 
burned. 

One  further  detail  deserves  mention;  the  elimination  of  flies. 
There  are  industries,  like  the  food-preparing  trades,  where  flies 
are  especially  dangerous.  But  the  faithful  use  of  screens,  the 
use  of  giant  fly-traps,  the  keeping  of  all  waste  and  rubbish 
carefully  collected  and  burned — these  work  wonders  in  ridding 
the  plant  of  this  germ  carrier. 

Dressing  Rooms. — Standard  practice  in  dressing  rooms  de- 
pends, as  with  washing  facilities,  on  the  nature  of  the  work. 
Where  a  complete  change  of  clothes  has  to  be  made,  the  need  is 
for  full  length,  individual  lockers.  In  trades  where  the  work  is 
especially  disagreeable  because  of  odors  or  dangerous  because  of 
dusts  or  vapors,  two  dressing  rooms  are  sometimes  provided. 

1  KKSKINK,  LILUAN,  op.  cit.,  p.  03. 


STANDARDS  OF  PHYSICAL  WORKING  CONDITIONS     131 

The  worker,  in  such  cases,  leaves  his  street  clothes  in  his  own 
locker  and  proceeds  through  a  shower  bath  room  to  the  room 
where  the  work  clothes  are  hung  on  racks  over  steam  pipes.  At 
night  the  work  clothes  are  left  to  dry;  the  worker  takes  a  bath, 
and  proceeds  to  his  locker  and  his  street  clothes  with  the  traces 
of  his  work  quite  effectually  eliminated. 

Dressing  rooms  should,  of  course,  be  completely  separated 
from  the  work  room;  and  there  should  be  completely  separate 
rooms  for  men  and  women.  There  should  be  a  bench  between 
the  rows  of  lockers,  and  if  possible  workers  who  leave  at  the 
same  time  should  have  alternate  lockers  to  avoid  congestion. 
The  lockers  themselves  should  have  a  steel  grill  bottom  and  top 
so  that  a  draft  of  warm  air  from  steam  pipes  beneath  the  lockers 
can  continually  circulate,  thus  drying  the  garments  that  are 
left  hanging  and  preventing  dust  from  settling.  In  size  such 
lockers  should  measure  sixty  inches  high  by  twelve  inches  wide 
by  fifteen  inches  deep;  and  they  should  be  provided  with  a 
combination  lock,  like  those  used  on  safes,  to  do  away  with  the 
bother  of  keys. 

The  importance  of  periodic  fumigation  of  locker  rooms  and 
lockers  should  not  be  forgotten,  since  nothing  so  contributes  to 
then*  non-use  and  unpopularity  as  a  reputation  for  uncleanliness 
or  vermin. 

The  provision  of  full  length  individual  lockers  in  a  separate 
dressing  room  is  not,  however,  essential  under  all  conditions. 
Separate  dressing  rooms  are  sometimes  required  by  law  for 
women  and  this  is  essential  if  any  change  of  clothing  takes  place. 
But  open  racks  with  coat  hangers  for  coats,  with  individual 
lockers  about  fifteen  inches  in  each  dimension  for  hats  and 
lunches  prove  a  satisfactory  arrangement  in  many  places.  Simi- 
larly for  men  in  plants  where  no  complete  change  of  clothes  is 
necessary,  it  is  usually  adequate  to  every  purpose  if  there  are 
clean,  dry,  safe  racks  where  street  clothes  can  be  hung.  These 
places  should,  however,  be  wholly  separated  from  the  work  room, 
where  there  is  little  likelihood  that  dust,  dirt  or  odor  will  harm 
the  clothes.  But  it  is  desirable  for  each  worker  to  have  some 
safe  place  to  keep  his  more  portable  possessions,  shoes,  hat, 
lunch,  etc.;  and  the  provision  of  lockers  fifteen  inches  in  each 
dimension  provides  for  this  in  a  satisfactory  manner. 

Health  Equipment,  Hospital,  etc. — The  extent  of  a  corpora- 
tion's equipment  in  first-aid  rooms,  doctors'  and  nurses'  offices, 


132  PERSONNEL  ADMINISTRATION 

hospitals,  special  clinics  and  laboratories  will  depend  on  other 
factors  than  the  dictates  of  standard  practice,  since  beyond 
certain  legal  minima,  standards  in  this  field  are  still  in  the 
making. 

A  separate  first-aid  room  should,  however,  be  provided  in  any 
plant  having  a  hundred  employees  or  over.  Its  equipment 
should  include  a  cot,  blankets,  stretcher,  running  hot  and  cold 
water,  screen,  and  the  usual  supply  of  bandages,  antiseptics  and 
instruments.  As  the  equipment  becomes  more  elaborate,  its 
purchase  should  be  turned  over  to  the  nurse  or  doctor  in  charge. 
One  simple  rule  about  the  arrangement  of  first-aid  rooms  can  also 
usefully  be  suggested.  There  should  be  a  door  or  screen  between 
the  employees  who  are  waiting  to  be  attended  and  the  one  who 
is  being  ministered  to.  It  is  usually  poor  psychology  for  the 
prospective  patient  to  witness  the  afflictions  of  his  fellow-worker 
who  is  under  treatment. 

Factory  Exterior. — There  is  an  unquestionable  psychological 
value  both  with  the  community  and  with  employees  in  having 
the  factory  exterior  neat  and  attractive.  There  is  no  inherent 
reason  why  all  buildings  devoted  to  industrial  uses  should  not  be 
architecturally  significant  or  at  least  inoffensive.  It  is  not  our 
purpose  here  to  indulge  in  Utopian  flights;  but  it  is  useful  to  con- 
sider that  the  squalor  of  so  much  factory  environment  today  finds 
its  reflection  in  a  widespread  attitude  of  indifference  if  not  of 
down-right  hostility  toward  work,  and  to  appreciate  that  by  taking 
thought  one  progressive  employer  after  another  is  demonstrating 
that  factory  buildings  can  be  made  varied,  interesting  and  even 
beautiful  without  undue  expense. 

Certain  things  that  every  corporation  can  and  should  do  are  to 
keep  its  own  yard  in  order,  its  waste  picked  up,  and  its  rubbish 
pile  concealed  or  removed  altogether.  It  can  also  provide  a 
sidewalk  to  the  factory  entrance  on  which  one  can  walk  dry- 
shod  at  all  times  of  the  year.  Again,  the  plant  can  be  kept 
painted.  Whether  the  management  will  go  beyond  this  and 
cultivate  a  lawn,  train  vines  against  the  factory  walls,  put  in 
window  boxes  and  plant  shade  trees,  is  not  a  matter  of  standard 
practice.  It  is  rather  a  matter  of  taste  and  judgment.  But  if, 
without  gaining  the  reputation  of  adorning  a  "whited  sepulchre," 
the  management  can  create  an  exterior  of  which  all  in  the  plant 
and  in  the  community  are  proud,  there  is  everything  to  gain 
thereby.  It  is  only  useful  to  recall  that  there  are  historic  warn- 


STANDARDS  OF  PHYSICAL  WORKING  CONDITIONS     133 

ings  against  cleaning  the  "outside  of  the  cup,"  while  within 
"they  are  full  of  extortion  and  excess!" 

We  conclude  this  subject  of  standards  of  right  working  condi- 
tions with  a  summary  of  the  two  most  essential  points : 

First,  we  have  been  considering  the  items  of  equipment  neces- 
sary to  supply  a  right  working  environment;  and  our  conclusions 
are  based  not  upon  "welfare"  notions  but  upon  patent  facts  of 
man's  physiological  characteristics  and  demands. 

Second,  we  have  called  attention  to  a  great  variety  of  what 
may  seem  minor  items,  but  which  do  in  fact  combine  together 
to  be  matters  of  critical  importance.  The  experience  of  almost 
every  plant  we  know  convinces  us  that  until  the  administration 
of  these  items  is  centralized  as  one  function,  preferably  under  the 
personnel  department,  adequate  and  constant  attention  is  not  paid 
to  them,  and  their  proper  maintenance  is  not  assured. 

Selected  References 

CALIFORNIA  INDUSTRIAL  WELFARE  COMMISSION.  I.  W.  C.  Order  No.  4. 
Laundry  and  Manufacturing  Industries.  Jan.,  1919.  San  Francisco. 
,  C.  E.  Natural  Lighting;  its  Engineering  Aspects,  Modern 
Practice,  and  the  Effects  of  Good  Lighting  Facilities  on  the  Worker. 
Wash.,  U.  S.  War  Industries  Board,  Employment  Management  Sec- 
tion, 1918,  typewritten. 

ERSKINE,  LILLIAN  and  JOHN  ROACH.     Standardization  of  Working  Essen- 
tials.     (In  Annals,  Am.  Acad.,  v.  71,  pp.  82-95,  May,  1917.) 
GUE  RESEARCH  BOARD.     The    Influence    of    Hours    of  Work  and  of 
Ventilation   on   Output   in   Tinplate    Manufacture.     London,    H.    M. 
Stationary  Office,  1919.     (Report  No.  1.) 

KENT,  WILLIAM.  Mechanical  Engineers'  Pocket-book,  9th  ed.,  rev. 
N.  Y.,  John  Wiley  &  Sons,  1916. 

NATIONAL  SAFETY  COUNCIL.  Principles  and  Practice  of  Safety;  a  Hand- 
book for  Technical  Schools  and  Universities.  Chicago,  Pub.  by 
Council,  1919. 

NEW  YORK  STATE  INDUSTRIAL  COMMISSION.  Industrial  Code,  with 
Amendments,  Additions  and  Annotations  to  Aug.  1,  1918.  Albany, 
N.  Y.,  pub.  by  Commission,  1918. 

NEW  YORK  STATE  INDUSTRIAL  COMMISSION.  Plan  for  Shop  Safety, 
Sanitation  and  Health  Organization.  Albany,  N.  Y.,  Pub.  by  Com- 
mission, 1919.  (Special  Bui.  No.  91.) 

NOTES,  H.  T.  Planning  for  a  New  Manufacturing  Plant.  (In  Annals, 
Am.  Acad.,  v.  85,  pp.  66-89,  Sept.,  1919.) 

SELBY,  C.  D.  Studies  of  Medical  and  Surgical  Care  of  Industrial  Workers. 
Wash.  Govt.  Print.  Office,  1919.  (U.  S.  Public  Health  Service  Bui. 
99.) 


134  PERSONNEL  ADMINISTRATION 

^  U.  S.  BUREAU  OF  LABOR  STATISTICS.  Welfare  Work  for  Employees  in 
Industrial  Establishments  in  the  United  States.  Wash.  Govt.  Print. 
Office,  1919.  (Bui.  250.) 

U.  S.  COUNCIL  OF  NATIONAL  DEFENSE.  Advisory  Commission.  Com- 
mittee on  Labor.  Code  of  Lighting  for  Factories,  Mills  and  other 
Workplaces.  Wash.  Govt.  Print.  Office,  1918.  (Welfare  Work 
Series,  No.  3.) 

U.  S.  COUNCIL  OF  NATIONAL  DEFENSE.  Advisory  Commission  Com- 
mittee on  Labor.  Requirements  and  Standards  upon  Heating  and 
Ventilation.  Wash.  Govt.  Print.  Office,  1919.  (Welfare  Work 
Series,  No.  4.) 

WISCONSIN  INDUSTRIAL  COMMISSION.  Women's  Department.  Factory 
Equipment,  Housekeeping  and  Supervision.  Madison,  Wis.,  Pub- 
lished by  Commission,  1918. 


CHAPTER  XI 
TRAINING  EXECUTIVES 

Management  as  most  recently  understood  means  essentially 
leadership.  "A  man's  right  to  have  authority,"  says  the  modern 
science  of  administration,  "in  proportion  to  the  scope  of  his 
creative  power  is  the  first  constitutional  principle  of  business."1 
But  effective  leadership  and  creative  power  mean  in  plain 
English :  Ability  to  deliver  the  goods  in  whatever  field  of  human 
effort  the  leadership  is  asserted. 

In  industry,  ability  to  deliver  the  goods  means,  of  course,  far 
more  than  sheer  ability  "to  get  out  the  production."  For  getting 
out  the  production  is  seen  today  to  involve  the  intelligent 
recognition  of  a  great  variety  of  factors.  That  managers  have 
frequently  been  able  to  get  out  production  and  deliver  the 
goods  in  the  past  without  much  conscious  preparation  or  special 
training,  argues  nothing  at  present.  For  the  management  of  in- 
dustry today  has  become  elaborate,  specialized,  complex;  the 
business  structure  is  difficult  to  understand,  even  for  those  who 
are  thoroughly  familiar  with  its  working,  and  internal  plant 
operation  requires  a  high  degree  of  trade  skill,  accounting  skill, 
personnel  skill. 

In  short,  leadership  in  modern  industry  is  destined  to  depend 
increasingly  upon  education  and  specialized  training.  Mani- 
festly, improvement  in  methods  of  factory  operation  in  the  labor 
side,  involves  all  groups  in  training  for  new  efforts  and  in  the 
use  of  new  methods.  But  it  is  peculiarly  the  management's 
job  to  understand  that  plant  administration  is  a  science  and  an 
art  and  that  because  this  is  so,  it  can  by  taking  thought  and 
by  training  make  its  own  efforts  more  scientific  and  more 
human.  Good  management  is  not  accidental;  it  is  not  today 
achieved  by  arbitrary  rule  of  thumb  methods.  It  is  created  by 
intelligent  leadership  based  on  a  mastery  of  the  scientific  method 
and  the  fruitful  administrative  experiments  of  the  last  ten  years. 
For  managers,  executives,  superintendents  of  every  rank,  and 

1  FERGUSON,  CHARLES.     The  Great  News,  p.  48. 

135 


136  PERSONNEL  ADMINISTRATION 

foremen,  the  great  need  throughout  industry  is  therefore  special 
training.  For  this  reason  we  occupy  the  present  chapter  with  a 
discussion  of  methods  of  training  higher  executives  and  in  the 
following  chapter  take  up  the  problem  of  foremanship. 

Any  effort  to  cope  with  the  present  extent  of  executive  incom- 
petency  implies  some  prior  agreement  as  to  the  qualities  the 
executive  should  possess.  Suggestions  as  to  the  nature  of  these 
qualities  are  therefore  included  below.  But  we  recognize  that 
even  if  all  managers  are  agreed  that  these  are  the  desirable 
or  even  the  available  qualities,  the  problem  of  identifying  them 
hi  a  given  individual  still  remains  to  be  solved. 

Qualities  of  the  Successful  Executive. — The  efficient,  success- 
ful executive  has  certain  characteristics  which  may  suggest  a 
criterion  for  use  in  the  selection  and  training  of  industrial  leaders. 

He  has  character.  He  is  truthful,  temperate,  just,  benevolent, 
magnanimous,  and  sympathetic.  He  is  honest.  To  be  direct 
and  straightforward  with  every  man  is  the  crucial  test  of  genuine 
executive  ability. 

He  has  creative,  sober  imagination.  The  ablest  leader  must  be 
able  to  project  himself  into  the  future.  He  is  a  practical  idealist 
who  not  only  dreams  of  new  ways  of  doing  things,  but  can 
actually  do  them.  He  thinks  and  lives  in  the  future.  Property 
and  business  are  to  him  a  means  to  an  end;  they  are  an  expres- 
sion of  creative  activity. 

The  business  leader  has  sound  judgment.  He  knows  whether 
his  ideas  are  workable,  and  when  he  plans  for  the  future,  he  has 
common  sense  as  well  as  imagination. 

Every  executive  needs  courage,  if  he  is  to  transform  his  ideas 
into  action,  and  if  he  is  to  put  new  processes  and  better  methods 
into  effect.  Many  a  leader  has  failed  because  he  was  timid, 
and  because  he  tried  to  please  everybody.  A  good  manager 
stands  his  ground  unflinchingly  against  the  inertia  of  habit  and 
prejudice. 

A  sense  of  humor  is  an  essential  asset  to  the  executive.  He  must 
be  able  to  see  people  and  events  on  their  comic  side;  and  under- 
stand that  most  situations  are  bettered  more  by  laughter  than 
by  weeping.  An  even  temper,  a  hearty  laugh,  or  a  pleasant  smile 
win  the  friendship  and  the  cooperation  even  of  those  with  whom 
he  does  not  come  into  close  contact. 

Insight  into  human  nature,  ability  to  understand  men,  enables  the 
manager  to  put  himself  into  the  place  of  his  subordinates,  and  to 


TRAINING  EXECUTIVES  137 

handle  difficult  situations  with  sympathy  and  justice.  "To 
censure  is  easy  and  in  the  power  of  every  man,  but  the  true  coun- 
selor should  point  out  conduct  which  the  present  exigency 
demands." 

The  progressive  business  manager  is  receptive.  He  is  open- 
minded  and  alert,  ever  ready  to  gather  with  unprejudiced  judg- 
ment information  on  all  the  subjects  which  are  related  to  his 
work. 

He  has  ability  to  collaborate  with  his  fellow  executives  and 
with  those  whom  he  directs  for  the  common  good.  He  surrounds 
himself  with  an  organization  designed  to  give  all  departments 
of  the  plant  and  all  employees,  the  opportunity  for  sympathetic 
teamwork.  In  a  word,  he  is  a  leader  in  cooperation. 

The  enormous  mass  of  detail,  due  to  the  subdivision  of  modern 
industry,  and  the  great  distances  which  orders  must  often  travel, 
make  organizing  ability  an  essential, — organizing  ability,  how- 
ever, which  has  regard  not  only  for  efficiency  in  production,  but 
for  the  development  of  the  individual  worker.  "The  art  of 
management  has  been  defined  as  knowing  exactly  what  you  want 
men  to  do,  and  then  seeing  that  they  do  it  in  the  best  and  cheapest 
way.  No  concise  definition  can  fully  describe  an  art,  but 
the  relations  between  employers  and  men  form  without  question 
the  most  important  part  of  this  art."1 

"The  subtle  efficiency  of  tact"  is  required  of  the  executive. 
This  quality  expresses  itself  chiefly  in  the  courtesy  with  which 
he  meets  and  deals  with  all  associates.  The  value  of  this  attri- 
bute is  emphasized  more  and  more  each  day.  "Industry  awaits 
the  administrator  who  shall  be  all  that  a  gentleman  should  be, 
who  shall  use  his  power  with  gentleness,  and  his  wealth  with 
imagination,  and  shall  illuminate  the  world  of  private  property 
with  the  light  from  the  far  away  interests  of  the  heart."2 

The  manager  must  usually  possess  an  expert  technical  knowledge 
of  the  field  under  his  immediate  supervision,  a  full  acquaintance 
and  familiarity  with  all  the  phases  of  the  business  in  which  he  is 
engaged,  and  a  clear  perception  of  its  relations  to  the  world  of 
industry.  He  is  usually  an  authority  on  certain  scientific  proc- 
esses. But  he  should  be  more  than  that.  He  should  have  a  grasp 
of  larger  problems  of  economic  organization  and  coordinate  his 
own  work  with  the  outside  factor. 

1  TAYLOR,  F.  W.     Shop  Management,  p.  21. 

2  JONES,  E.  D.     Business  Administrator,    p.  208. 


13f  PERSONNEL  ADMINISTRATION 

|.  * 

K ;  Character ;    creative^     sober     imagination ;  sound,    judgment ; 

"> courage;  a  sense  of  humor;  ability  to  cooperate,  to  understand 
men,  and  to  organize;  receptivity;  courtesy;  expert  technical 
knowledge, — these  are  essential  qualifications  of  the  business 
executive.  By  what  training  may  they  be  fostered  and  devel- 
oped, and  what  are  the  conditions  necessary  for  the  proper  ac- 
complishment of  that  training? 

Essential  Prerequisites  for  Training  Leaders. — Time,  equality 
of  opportunity,  and  fair  financial  and  non-financial  rewards  are 
the  three  essential  prerequisites  for  the  successful  instruction  of 
leaders.  Educational  work  requires  time.  In  order  to  be  effec- 
tive, it  must  spread  over  a  long  term.  Moreover,  it  costs  in 
real  effort.  Men  cannot  strain  through  a  hard  day,  and  then 
effectively  pursue  studies  for  self  improvement;  for  the  powers 
of  thinking  and  producing  have  been  diminished. 

A  shorter  working  day  and  instruction  given  on  company 
time  are  the  two  solutions  of  the  problem.  Some  concerns  set 
aside  a  period  of  several  weeks  for  intensive  courses;  others  give 
a  few  hours  a  week  for  half  a  year,  a  whole  year,  or  more ;  others 
grant  their  employment  managers,  factory  inspectors,  indus- 
trial secretaries,  and  service  superintendents  leaves  of  absence 
and  pay  their  expenses  at  technical  schools. 

A  fair  opportunity  for  every  employee  to  take  the  training 
courses  is  the  second  essential.  An  organization  which  offers 
to  all  ambitious  workers  the  greatest  chance  for  personal  develop- 
ment is  promoting  the  highest  and  best  type  of  efficiency.  The 
presence  of  nepotism  and  favoritism  is  fatal  to  executive  morale. 
Every  man  must  be  permitted  to  bring  out  the  best  that  is  in 
him  and  to  advance  because  of  his  ability.  Progress  depends 
less  on  mechanical  perfection,  than  on  the  liberation  of  human 
personality. 

A  final  prerequisite  for  the  effective  training  of  leaders  is  a 
just  system  of  financial  and  non-financial  rewards.  Extraordi- 
nary efforts  must  be  accompanied  by  increased  remuneration. 
Whether  it  should  take  the  form  of  bonuses,  profit  sharing,  or 
special  premiums,  is  a  problem  which  we  have  briefly  considered 
elsewhere. 

The  non-financial  rewards — advancement  in  honor  and  in 
responsibility — are  usually  as  powerful  a  stimulus  as  an  increase 
in  salary.  If  the  administration  will  chart  the  possible  steps  in 
promotion,  and  keep  the  way  open;  if  it  will  select  men  to  under- 


TRAINING  EXECUTIVES  13f 

study  the  positions  of  influential  executives,  minor  executives 
will  as  a  rule  take  the  initiative  in  carrying  forward  their  own 
development. 

Members  of  the  Training  Courses. — The  selection  of  ex- 
ecutives who  are  to  take  the  training  courses  is  an  important  mat- 
ter. They  should  be  chosen  because  of  a  conviction  that  they 
have  potential  powers.  There  is  a  large  field  from  which  to  draw. 
First  and  most  significant  is  the  plant  itself;  second  is  the  outside 
world, — other  factories,  the  colleges,  technical  schools,  and 
professions. 

The  factory  is,  of  course,  the  principal  source  of  supply.  The 
men  who  are  already  executives  need  education  as  much  as  do 
the  workers  in  the  ranks.  If  they  are  to  be  efficient,  if  they  are 
to  keep  abreast  of  the  times,  they  must  study  and  learn  continu- 
ally. This  is  especially  true  of  the  minor  executives, — those 
who  hold  positions  of  responsibility  without  having  final  author- 
ity. Superintendents  and  their  assistants;  department  mana- 
gers with  their  staffs  of  buyers  and  salesmen  supervisors; 
inspectors;  industrial  experts  from  the  planning,  engineering, 
and  the  employment  departments;  accountants,  and  auditors 
from  the  clerical  force,  and  the  foremen,  subforemen,  gang  and 
speed  bosses, — all  should  from  time  to  time  be  members  of  classes 
for  organized  instruction. 

In  order  to  assure  impartial  selection  from  among  executives 
for  this  training  and  subsequent  advancement,  some  gauge  upon 
their  comparative  ability  is  needed.  The  rating  scales  already 
discussed  are  exceedingly  useful  in  this  connection. 

In  the  search  for  executive  material  in  the  United  States,  the 
latent  ability  of  the  laborers  within  the  plant  has  often  been 
neglected.  Under  the  German  system  of  widely  developed  in- 
dustrial training,  which  searches  out  the  capacity  of  every  factory 
worker,  65  per  cent,  of  the  leaders  in  the  foremost  industries  have 
come  up  from  the  ranks.  American  industry  would  undoubtedly 
profit  by  a  widened  basis  for  selection  of  its  executives. 

Other  plants  in  the  same  line  of  work  can  also  furnish  candi- 
dates for  executive  training,  if  there  is  some  organized  plan  of 
promoting  people  from  one  plant  to  another.  Managers  are 
beginning  to  realize  the  value  not  only  to  society  but  to  their  own 
plant  of  encouraging  and  assisting  employees  to  get  better 
positions  with  other  concerns.  But  a  policy  of  advancing  execu- 


140  PERSONNEL  ADMINISTRATION 

tives  "up  and  out"  requires  special  executive  training  if  it  is 
to  be  successfully  carried  into  effect. 

The  professions  also  furnish  their  quota  of  executives.  Large 
scale  management  looks  to  the  engineer,  the  chemist,  the  physi- 
cist, the  doctor,  and  the  educator  for  guidance  and  advice; 
and  members  of  these  professions  are  increasingly  finding  them- 
selves in  administrative  positions  where  executive  training  proves 
indispensable. 

Finally,  university  and  technical  school  graduates  are  being 
largely  selected  for  positions  which  call  for  general  intelligence, 
and  for  ability  to  meet  and  handle  people.  They  have  been 
trained  in  the  proper  approach  to  new  intellectual  problems;  they 
know  how  to  generalize;  they  see  the  particular  in  relation  to  the 
whole;  they  are  more  mature  and  are  able  to  advance  faster 
than  are  men  who  have  entered  business  earlier  in  life.  But 
their  general  training  must  usually  be  supplemented  by  special 
intensive  instruction  in  the  corporation  if  their  effectiveness  is 
to  be  turned  to  account  at  once. 

Administration  of  Training. — The  administration  of  instruc- 
tion and  the  problem  this  involves  must  be  considered  in  any 
discussion  of  executive  training.  Where  the  firm  is  sufficiently 
large  to  warrant  the  expenditure,  a  training  director  should  be 
in  charge;  and  there  should  be  an  able  corps  of  teachers  and 
lecturers.  The  director's  work  will  be  to  organize  courses  and 
prepare  manuals  and  reading  lists.  He  will  keep  his  staff  of  in- 
structors constantly  informed,  through  meetings  and  personal 
conferences,  of  the  general  training  policy  of  the  company.  And 
he  will  systematize  his  work  in  such  a  way  that  a  standard  sched- 
ule, like  that  of  a  graded  school,  may  be  followed,  and  men  may 
be  started  wherever  their  capacity  permits.  He  will  not,  how- 
ever, confine  his  attention  simply  to  the  study  of  conditions  in 
his  own  plant.  He  will  investigate  the  training  methods  em- 
ployed in  other  industries.  In  a  word,  he  will  be  the  liaison 
officer  between  education  and  industry. 

It  is  difficult  to  find  men  with  just  the  equipment  to  fill  the 
position  of  director  of  education.  Companies  which  carry  on 
corporation  schools  find  it  necessary,  in  most  cases,  to  train 
their  own  educational  supervisors.  Several  attempts  have  also 
been  made  in  special  courses  in  the  universities  to  prepare  men 
for  this  field. 

All  instructors  for  executive  training  courses  should  be  trained 


TRAINING  EXECUTIVES  141 

men — trained  in  the  subject  that  they  are  to  teach,  and  in  the 
art  of  teaching  it.  The  relative  emphasis  in  their  equipment  will 
depend  upon  the  training  policy  in  force.  For  there  are  three 
types  of  corporation  schools:  Those  which  prepare  workers 
for  a  specific  job  in  the  plant;  those  which  are  designed  not  only 
to  teach  apprentices  in  any  field  the  "technicalities  of  a  specific 
trade, "  but  to  develop  initiative,  resourcefulness  and  ingenuity 
in  the  workers;  and  those  which  conduct  general  educational 
courses  "designed  to  give  the  employees  an  opportunity  for 
general  educational  broadening,  perhaps  something  that  had 
been  denied  in  their  school  days."1 

It  is,  as  a  rule,  easiest  to  get  teachers  for  the  general  educational 
work.  Enough  college  and  normal  school  graduates  with  the 
requisite  personal  qualifications  are  usually  available.  But 
good  technical  and  trade  instructors  are  rare.  For  they  should 
be  familiar  not  only  with  the  technique  of  teaching,  but 
should  have  had  from  three  to  five  years  trade  practice  in  their 
subject.  "Generally  for  industrial  training,  the  best  results  will 
be  obtained  from  the  practical  man  trained  as  a  teacher,  for  he, 
and  he  only,  has  a  thorough  knowledge  of  the  trade,  so  that  he 
may  analyze  it,  and  realize  as  well  what  the  employee  must 
know."2  Pedagogical  experience  is,  however,  as  necessary  as 
the  trade  experience;  for  a  person  who  understands  the  art  of 
teaching  can  produce  results  in  a  much  shorter  time  than  can  the 
untrained  foreman  or  man  from  the  ranks. 

An  Outline  for  Instructor  Training. — (From  a  company  which 
believes  that  "there  are  three  things  which  make  for  the  ideal 
instructor.  ...  A  complete  knowledge  of  his  subject,  knowl- 
edge of  how  to  instruct,  and  a  pleasing  and  forceful  personality.") 

I.  ANALYSIS  AND  CLASSIFICATION  OF  TRADE  KNOWLEDGE: 

A.  Introductory  talk 

purpose  and  problems  of  the  work,  the  kinds  of  trade  training 

B.  Broad  look  at  industry 
different  types  of  jobs 

C.  First  steps  in  analyzing  a  trade 

picking  out  the  block  and  subdividing  it  into  jobs 

D.  Arranging  these  jobs  in  the  easiest  order  for  learning 

E.  Selecting  a  rating  scale  and  determining  at  what  points  it  should 

be  used 

F.  Correlated  information 

1  N.  A.  C.  S.,  Seventh  Annual  Proceedings,  1919,  p.  621. 
*  N.  A.  C.  S.,  Seventh  Annual  Proceedings,  1919,  p.  608. 


142  PERSONNEL  ADMINISTRATION 

II.  LEARNING  HOW  TO  IMPART  IT  TO  OTHERS: 

A.  Introductory  talk  on  work  of  this  section 

defining  instruction,  the  instructor's  problem,  and  the  personality 
of  the  instructor 

B.  Preparing  learner's  mind  for  new  material 

C.  Presenting  the  new  material  to  the  learner 

D.  Helping  the  learner  master  new  material 

E.  Checking  up  the  learner  to  see  if  he  has  mastered  new  subject 

F.  Laying  out  typical  lessons  using  methods  just  studied 

G.  Practice  instructing 

III.  CORRELATED  FACTS,  RECORDS  AND  COMPANY  POLICY: 

A.  Little  talks  on  psychology  as  related  to  instructing 

B.  Mechanical  drawing 

C.  The  structure  of  wood 

D.  Industrial  design 

E.  Company  policy  and  attitude  of  instructor  to  men  in  shop 

F.  Records 

Time  of  Training.- — The  cost  of  instructing  men  for  their 
jobs  is  often  great,  yet  many  business  leaders  have  such  a 
keen  appreciation  of  its  value  to  the  firm  that  they  not  only 
support  it  entirely,  but  give  it  on  company  time.  Perhaps, 
however,  if  the  cost  were  borne  both  by  the  company  and  those 
who  are  studying,  there  might  be  more  sustained  enthusiasm. 
Employees  may  not  value  what  they  receive  for  nothing.  The 
management  might  cover  one-half  or  two-thirds  of  the  expense, 
and  refund  the  money  paid  by  the  students  when  the  course 
has  been  completed. 

Class  Work. — All  class  work  should  be  planned  with  reference, 
first  to  the  work  of  the  production,  sales  or  financial  department 
which  the  official  is  to  enter  and,  second,  to  learning  the  art 
of  handling  men.  It  should  include  subjects  from  the  technical 
and  liberal  arts,  from  production  and  personnel  fields  of  work. 
Classes  are  held  in  the  plant  itself,  or  in  cooperation  with  a 
nearby  university,  a  public  school,  a  Y.  M.  C.  A.,  etc.  The  classes 
should  not  be  too  large.  The  training  of  executives  requires 
constant  individual  supervision. 

Where  the  executive  must  be  a  specialist  in  the  technical  proc- 
ess which  he  has  under  his  direction,  he  needs  scientific  courses. 
Lessons  which  tell  the  story  of  raw  materials,  and  give  their 
history  from  the  crude  substance  to  the  finished  product,  and 
lessons  in  science,  mathematics,  and  mechanical  drawing  are 
often  essential. 

Of  the  liberal  arts,  history,  political  science,  sociology,  phi- 


TRAINING  EXECUTIVES  143 

losophy,  psychology,  English,  and  public  speaking  are  all  valuable 
for  the  business  executive.  They  give  him  a  substantial  basis 
upon  which  to  form  a  fair,  accurate,  and  unprejudiced  judgment. 
They  really  require,  however,  an  extended  period  of  training — 
one  which  has  preferably  begun  long  before  he  entered  industry. 

The  art  of  handling  men  is  a  subject  which  is  more  and  more 
becoming  a  field  of  its  own.  During  the  war,  the  government 
appreciated  so  keenly  the  need  for  expert  assistance  in  handling 
the  labor  problem,  that  it  organized  courses  for  training  employ- 
ment executives.  In  several  instances  these  have  become  per- 
manent, and  include  in  their  curricula  a  study  of  business 
organization,  labor  policies,  industrial  health,  trade  union 
problems,  statistics,  and  psychology.  Employers  are  beginning 
to  realize  their  value,  and  are  sending  their  personnel  executives 
to  New  York,  Pittsburgh,  Cambridge  and  elsewhere,  where  the 
schools  are  established. 

The  instruction  for  those  who  would  become  executives  may 
well  comprehend  a  much  broader  training  than  could  be  given 
in  class  work.  Lectures  by  high  officials,  shop  talks  and  com- 
mittee meetings  are  all  excellent  mediums  through  which  to 
start  the  discussion  of  any  ethical  problems  which  the  men  are 
interested  to  solve.  There  may  also  be  courses  of  lectures, 
seminars,  an  organized  use  of  the  library,  group  conferences, 
committee  systems,  rotation  in  different  positions,  visits  to  plants 
and  museums,  and  scientific  society  and  study  club  meetings. 

It  is  difficult  if  not  impossible  to  argue  that  any  particular 
subjects  have  unique  value  in  helping  to  "build  character." 
Character  building,  vital  as  it  is  where  the  development  of  execu- 
tives is  involved,  is  largely  a.  by-product  of  the  doing  of  any 
worth  while  job  well.  Yet  if  the  instructor  is  a  man  or  a  woman 
with  lofty  purposes,  intelligent  ideas,  warm  heart  and  a  keen 
devotion  to  his  subject,  he  will  inevitably  impart  a  certain  quality 
of  moral  earnestness  which  is  precious  and  in  need  of  extension. 

Examples  of  Courses  for  Training  Executives. — Corporation 
training  schools  arise  in  response  to  such  individual  demands 
that  no  two  of  them  are  exactly  alike.  Some  are  open  to  all 
employees,  others  are  arranged  primarily  for  foremen  and 
inspectors,  while  still  others  are  planned  to  meet  the  needs  of 
college  graduates. 

Courses  given  by  Goodyear  Tire  and  Rubber  Company,  Akron, 
Ohio. — "  Every  executive  in  the  plant,  except  some  of  the  inspectors,  is 


144 


PERSONNEL  ADMINISTRATION 


in  school.  All  of  the  major  executives,  from  the  production  superinten- 
dent down,  are  taking  some  kind  of  educational  courses Our 

organization  runs  somewhat  in  this  way:  the  inspector  is  the  lowest 
grade,  or  first  step  on  the  ladder  of  the  executive  positions.  Next  in 
line  is  the  head  inspector,  who  oversees  the  work  of  a  number  of  inspec- 
tors. We  work  in  three  shifts  a  day,  so  that  it  is  necessary  for  us  to  have 
shift  foremen,  and  the  best  man  in  line  for  promotion  gets  one  of  these 
positions;  then  he  becomes  a  department  foreman,  and  so  on  up  to  the 
position  of  production  superintendent."1 

"Production  Flying  Squadron"* 

The  object  of  the  "Flying  Squadron"  courses  is  to  provide  a 
broad  general  and  technical  background.  The  several  hundred 
men  trained  in  this  manner  are  made  thoroughly  familiar  with 
every  detail  of  the  manufacture  of  rubber  and  are  therefore  com- 
petent to  assume  positions  of  responsibility  throughout  the  plant. 

Public  speaking 26  weeks 

Letters  and  reports 13  weeks 

Sheldon  Introductory  Salesmanship 13  weeks 

Economics 26  weeks 

Rubber  manufacture  practice 39  weeks 

Economics: 

(a)  Organization  and  management 26  weeks      fwo  i  )ura 

(b)  Costs. .  13  weeks       per 

Goodyear  administration: 

(a)  Business  principles  policies 26  weeks 

(b)  Factory  management, — practice  and 

problems 39  weeks 

Labor: 

(a)  Employment  management  principles  1  , 

(6)   Employment  management  practice  .  / 

"ENGINEERING  SQUADRON " 

Shop  mathematics 39  weeks 

Mechanical  drawing 39  weeks 

English ....    3«.»  weeks 

Two  hours 

Shop   mechanics 39  weeks       per  week 

Mechanical   drawing 39  weeks 

Shop  mechanics  (phyHicfl) .39  weeks 

Engineering  economics 39  weeks 


1  MR.  CRAIGMILE.     N.  A.  C.  S.,  Seventh  Annual  Proceedings,  1919,  p.  614. 
1  From  a  typewritten  manuscript. 


TRAINING  EXECUTIVES  145 

"INSPECTORS" 
(Section  A  and  B) 

Arithmetic 39  hours 

English 26  hours 

(a)  Economics,  public  speaking 13  hours 

Economics 26  hours 

Rubber  manufacture  practice 39  hours 

T    ,  Iwo  hours 

Labor: 

/  N  T,      i  •     •  i      ^  per  week 

(a)  Employment  management  principles  \        , 

(6)  Employment  management  practice. .  / 

Charts  and  reports 13  hours 

Factory  costs 13  hours 

Mechanical  drawing 52  hours 

Requirements:  Section    A:    Grammar    School    Education    and    Mental 

Alertness  Test 

Section  B:  Mental  Alertness  Test  only 
Section  B  men  will  have  39  hours  of   straight   English 
work 


"FOREMEN" 

Department  management:  Charts,  reports,  department  operation 
Economics:  Principles,  application 
Costs:  Fundamentals,  details 
Labor:  Labor  policies 

Guidance:  Consultation,  development  records 
Weekly  events:  Lectures  by  best  business  talent  available 


Materials:    Crude   rubber,    cotton,    compounding    materials,  and   com- 
pounding 

Manufacture:  History,  general  processes,  products 

Organization:    Analysis,    supervision   functions,    of    manager    and    sub- 
executives,  human  factors,  initiative  and  advancement 

Mathematics:  Arithmetic,  algebra,  trigonometry,  calculus 

Library:  Book  reviews,  reading  courses,  current  events 

Recreation:  Gymnasium,  games 

Synopsis  of  a  Course  for  Minor  Executives  of  Another  Large 

Corporation 

FIRST  YEAR 

Advantages  of  the  course 

Elementary  concepts  of  the  physical  sciences  as  applied  to  the  business 
Studies  in  units  of  measurement 

Definition  of  fundamental  terms  used  in  the  business 
About  fifteen  detailed  lessons  giving  a  thorough  analysis  of  the  physics 

and  chemistry  of  the  business 
Modern  industry  and  business  principles 
History  of  the  corporation 
Processes 

10 


146  PERSONNEL  ADMINISTRATION 

SECOND  YEAR 

Two-thirds  of  time:  Processes,  equipment,  finished  product 
One-third  of  time:  Management,  organization,  welfare  work,  accidents, 
sanitation,  relation  of  the  foreman  to  the  plant 


The  Laboratory  Method. — The  efficient  staff  executive  must 
almost  necessarily  have  a  knowledge  of  the  business  as  a  whole. 
One  of  the  surest  ways  for  him  to  get  this  is  to  work  through  all 
the  departments  of  the  plant  by  means  of  a  combined  study  and 
laboratory  method.  Laboratory  work — the  actual  learning  by 
doing — gives  an  idea  of  processes;  while  the  study  forms  the 
basis  for  a  scientific  outlook.  The  Southern  Pacific  Company 
School  for  the  training  of  executives  is  founded  on  this  idea,  and 
eighteen  per  cent,  of  the  important  promotions  have  been 
given  to  graduates  of  the  special  training  course.  Mr.  Norman 
Colyer  writes: 

"The  aim  of  our  student  course  is  to  give  to  young  men  in  the  employ 
of  the  Company  an  opportunity  to  pass  through  different  departments 
for  the  purpose  of  gaining  such  coordinated  knowledge  of  the  entire 
railroad  us  will  fit  them  better  to  assume  positions  of  responsibility.  It 
is,  in  fact,  a  laboratory  course  wherein  the  student  performs  the  actual 
work  of  the  department  to  which  he  is  assigned,  supplemented  by  a 
parallel  course  of  reading  in  text-books  nnd  railway  publications  and 
periodicals  ....  Briefly,  the  procedure  is  as  follows:  Upon  appoint- 
ment, the  student  is  first  placed  at  a  station  of  medium  size  for  a  term 
of  six  months.  This  is  because  the  station  agent  handles  both  the  be- 
ginning and  the  end  of  transportation.  The  student  is  expected  to  per- 
form such  duties  as  are  assigned  to  him  by  the  agent,  and  the  agent  is 
expected  to  afford  him  such  diversified  experiences  as  will  give  him  an 
all-round  knowledge  of  station  work,  including  ticket  office,  warehouse, 
baggage  room,  yard,  and  the  solicitation  of  business.  Being  an  extra 
man,  the  student  is  not  bound  clown  to  routine,  but  is  permitted  to  dis- 
tribute his  time  in  such  a  way  as  to  treat  each  feature  with  equal 
thoroughness.  Next,  the  student  is  assigned  consecutively  to  Mainte- 
nance of  Way,  the  office  of  the  Superintendent  of  Transportation, 
Motive  Power,  Train  Service,  Accounting  Department  and  Tariff 
Bureau,  spending  three  months  in  each.  This  completes  his  second 
year  as  a  student,  and  he  should  now  have  a  working  knowledge  of  the 
several  department**  of  the  railroad  and  their  mutual  interdependence. 
At  the  student's  option  (subject  to  the  approval  of  the  management)  he 
next  elects  to  specialize  in  either  Operation  and  Maintenance,  Passenger 
and  Freight  Traffic,  or  Accounting."1 

1  BEATTY,  ALBERT  J.     Corporation  Schools,  pp.  68-59. 


TRAINING  EXECUTIVES  147 

Lectures. — Lectures,  especially  if  they  are  illustrated  with 
slides  and  motion  pictures,  and  are  conducted  like  a  forum,  with 
an  opportunity  for  questions  and  discussions,  are  a  valuable 
part  of  any  plan  for  training  executives.  A  company  man,  who 
has  been  especially  successful  in  his  own  particular  field  should 
occasionally  speak  to  the  students  and  present  his  personal 
experiences  and  ideas  on  the  subject  that  they  are  studying. 
And  at  other  times  an  outside  lecturer,  who  is  widely  informed 
and  a  specialist,  should  be  used  to  bring  in  a  new  point  of  view 
and  new  enthusiasm. 

Group  Conferences. — The  group  conference,  which  in  many 
concerns  is  both  departmental  and  interdepartmental,  may  be 
made  an  effective  educational  factor.  It  is  like  a  college 
seminar, — a  place  in  which  topics  of  importance  to  everyone 
may  be  discussed.  Company  policies,  standardization,  the 
larger  industrial  interests  of  the  plant  and  trade  success  should 
come  up  for  open  debate.  Group  conferences  broaden  the  hori- 
zon, and  develop  the  ability  to  think  clearly  and  quickly,  but 
they  should  have  a  leader  to  guide  them.  If  each  member  feels 
that  he  is  in  a  measure  responsible  for  their  success,  they  may  be 
made  a  source  of  real  professional  inspiration. 

Committee  Systems. — The  committee  system  may  be  made 
another  important  center  for  the  development  of  executives. 
Committees  for  the  handling  of  problems  of  finance,  accounting, 
production,  and  marketing  have  been  in  existence  for  some  time, 
and  recently  many  of  the  human  relations  problems  have  been 
included, — employment,  promotion,  transfer,  health,  safety, 
etc.  An  interesting  example  is  the  committee  system  of  the 
Montgomery,  Ward  Company  of  Chicago. 

"All  executives,  minor  as  well  as  major,  take  part  in  running  the 
affairs  of  the  business.  ...  It  is  a  plan  to  delegate  authority,  to 
relieve  the  heads  of  the  multiplicity  of  details  and  have  them  free  to 
handle  the  big  problems  of  finance,  general  plans,  policy,  etc.  ...  As 
organized  and  conducted  by  this  company  the  committee  system.  .  .  . 
has  logically  three  functions: 

1.  Legislative. 

2.  Administrative. 

3.  Educative. 

"  The  Legislative  function  may  be  defined  as  the  power  and  authority 
to  devise  and  lay  out  systems  and  set  up  rules  for  the  general  conduct 
of  the  business.  There  is  a  board  in  supreme  authority  over  all  which 


148  PERSONNEL  ADMINISTRATION 

legislates  on  matters  of  policy  and  upon  systems  as  they  may  effect 
policy.  It  has  the  power  of  veto  on  any  or  all  boards.  This  board  is 
called  the  Officers'  Board.  The  lesser  boards  and  committees  may 
legislate  upon  matters  that  come  within  their  jurisdiction  which  is  de- 
fined when  the  board  or  committee  is  created. 

"  The  Administrative  function  is  charged  with  the  execution  of  rules 
and  systems  as  they  may  be  set  up  and  defined  by  the  legislative.  One 
function  is  not  definitely  divided  from  the  other,  however,  as  all  boards 
and  committees  may  legislate  on  certain  matters,  as  well  as  adminis- 
trate them. 

"  The  Educative  function  needs  very  careful  definition.  All  members 
of  Boards  and  Committees  have  each  a  definite  position  to  fill.  .  .  . 
Every  higher  executive  is  a  member  of  some  board  and  he  must  so  ar- 
range his  work  that  he  will  have  time  to  attend  all  regular  meetings  of 
his  board  as  well  as  serve  on  committees  as  he  may  be  selected.  It  is 
not  an  imposition  upon  any  executive's  time  to  attend  board  meetings 
or  attend  to  committee  work — each  board  meeting,  each  committee 
appointment  is  a  real  opportunity  to  serve  not  only  the  business  but  also 
to  bring  himself  forward  into  a  large  sphere  of  development  and  useful- 
ness. .  .  .  It  is  indeed  a  privilege,  and  should  be  considered  so,  to 
take  part  in  Board  and  Committee  work — it  brings  one  away  from  his 
own  department  where  he  may  be  lost  in  a  maze  of  detail,  and  carries 
him  out  into  contact  with  the  other  departments  and  teaches  him  what 
the  other  fellow's  problems  are.  It  gives  him  an  excellent  perspective 
of  the  business  as  a  whole. 

"Each  man's  work  on  a  board  or  in  a  committee  is  judged  as  carefully 
as  the  work  he  performs  in  his  own  division.  .  .  .  He  should  realize 
that  a  task  well  done  serves  both  the  business  and  himself.  One's  work 
on  his  board  or  in  his  committee  may  be  the  means  of  placing  him  in  a 
more  responsible  position. 

"Membership  on  a  committee  gives  one  the  opportunity  to  become 
educated  in  the  principles  and  details  of  our  business.  It  is  the  system 
we  employ  to  broaden  and  develop  the  members  of  our  organization, 
and  it  spreads  the  responsibility  for  efficiency  in  our  various  activities, 
the  details  of  which  are  too  many  for  one  man  to  master  or  supervise. 
There  is  therefore  a  definite  object  in  placing  anyone  on  a  committee, 
and  this  object  may  be  defined  as  follows: 

1.  You  are  appointed  in  the  belief  that  your  experience  and  knowledge 
will  enable  you  to  give  valuable  advice,  and  that  the  knowledge  you 
obtain  from  other  members  of  the  committee  will  tend  to  broaden  your 
own  knowledge  of  the  business  to  the  benefit  of  both  the  business  and 
yourself. 

2.  You  are  appointed  in  the  belief  that  you  will  express  your  opinion 
frankly  and  freely  and  assume  your  full  responsibility  for  any  action 
taken  by  your  committee,  and  this  will  be  expected  of  you. 


TRAINING  EXECUTIVES  149 

3.  Membership  on  a  committee  places  all  members  on  the  same  level 
in  that  committee.     Your  opinion  and  your  vote  are  as  important  as 
that  of  anyone  else  in  its  meetings. 

4.  If  you  differ  from  the  findings  or  conclusions  of  a  committee  you 
must  register  an  adverse  vote,  or  submit  a  minority  report  or  you  will  be 
held  to  concur  in  its  action.     The  time  to  talk  is  in  the  meeting,  as 
later  explanations  are  of  little  avail."1 

A  railway  company  has  found  that  committees  appointed  to 
"bring  about  the  economical  use  of  locomotive  coal"  have  been 
educative  as  well  as  economical.  In  1916,  Fuel  Committees, 
consisting  of  the  Superintendent  (Chairman),  Master  Mechanic, 
Road  Foreman  of  Engineers,  Principal  Roundhouse  Foreman, 
from  two  to  eight  Engineers,  and  from  two  to  eight  Firemen, 
were  appointed  in  each  division.  The  engineers  and  firemen 
were  changed  every  six  months;  the  other  officials  were 
permanent. 

The  purpose  of  the  committee  was  to  promote  fuel  economy  by : 

(a)  Stimulating  interest. 

(6)  Creating  friendly  rivalry  through  a  system  of  comparative 
reports  showing  the  success  or  failure  of  each  employee. 

(c)  Exchanging  ideas  and  experiences. 

(d)  Creating  a  council  from  which  friendly  advice  was  sought 
and  given. 

One  of  the  most  important  results  of  the  committee  system  is 
the  training  it  gives  in  the  scientific  approach  to  human  relations 
problems.  A  large  firm  writes,  "The  one  feature  that  we  particu- 
larly insisted  on  from  the  beginning  was  that  all  (committee) 
decisions  should  be  based  on  fact  and  not  on  tradition  or  personal 
prejudice." 

Inspection  Trips. — Inspection  trips,  both  to  other  plants  and 
within  the  factory  itself,  give  a  broad,  general  view  of  the  activ- 
ities of  the  industry  which  is  invaluable  to  the  executive.  They 
supplement  class  training  and  increase  individual  efficiency. 
They  should  be  as  carefully  planned  as  is  a  class  room  recitation 
and  the  students  should  know  where  to  go,  what  to  see,  what 
questions  to  ask,  and  whac  items  to  discuss.2  Otherwise  they 
may  be  distracted  and  fail  in  the  accomplishment  of  the  object 
for  which  they  are  sent. 

1  From  a  circular  letter. 

2  See  Appendix  A  for  outline  of  topics  to  be  considered  when  the  visit 
is  to  the  personnel  department. 


150  PERSONNEL  ADMINISTRATION 

Sometimes  the  students  are  required  to  act  as  messengers 
about  the  shop  and  to  substations  and  agencies  throughout  the 
city;  sometimes  they  are  asked  to  go  to  different  departments 
on  successive  days,  and  are  given  instruction  as  to  what  they  are 
to  see  on  the  way.  Outside  the  plant,  the  same  care  in  organizing 
the  trip  should  be  observed.  An  experienced  leader  should  be 
in  charge,  the  group  should  be  small,  and  written  reports,  which 
will  later  form  the  basis  for  discussion,  should  be  made.  The 
points  in  which  other  factories  are  superior,  and  in  which  one's 
own  plant  excels  should  certainly  be  considered.  One  large 
company,  which  sent  a  number  of  minor  executives  on  an  observa- 
tion tour,  made  several  improvements  in  its  own  method  of 
administration  and  production  as  a  result. 

Museums,  Trade  Exhibits,  Society  Meetings,  etc. — The 
more  formal  methods  of  training  may  be  rounded  out  by  the 
auxiliary  instruction  which  is  gained  through  membership  in 
societies  for  improving  industrial  relations;  through  participa- 
tion in  business  conventions;  through  visits  to  museums  or  the 
study  of  circulating  collections  of  books  and  trade  periodicals. 

Dinners  and  Clubs. — Club  meetings  and  dinner  conferences 
at  which  problems  are  debated  have  their  place  in  any  educational 
program.  Some  manufacturers  and  mercantile  houses  have  for 
years  realized  their  value  in  introducing  new  ideas  into  the  plant. 
To  these  luncheons  and  dinners  specialists  are  invited,  and 
discussions  follow  the  meal. 

Correspondence  Courses. — Correspondence  courses  offer  an- 
other method  of  training.  Under  suitable  conditions  and  with 
the  right  kind  of  text  books  they  may  be  very  successful.  Their 
results  depend,  however,  upon  a  high  degree  of  determination 
to  see  the  project  through.  If  individuals  or  a  group  can  take 
a  course  with  the  definite  assurance  of  their  executive  superiors 
that  their  diplomas  will  count  in  securing  them  advancement, 
there  is  genuine  likelihood  that  the  training  will  betaken  seriously. 
Indeed,  it  may  often  be  worth  a  company's  while  to  give  some 
cash  bonus  to  those  who  complete  an  approved  course  of  corre- 
spondence study. 

Influence  of  the  Demand  for  Business  Leaders  on  the  Colleges, 
etc. — The  demand  for  business  leaders  is  having  a  decided 
influence  on  the  curricula  of  some  colleges  and  universities. 
There  is  a  growing  movement  in  the  direction  of  greater  unity 
between  business  and  education,  since  many  of  the  great  Aineri- 


TRAINING  EXECUTIVES  151 

can  industries  have  a  wide  range  of  executive  positions  for 
which  college  training  is  practically  prerequisite. 

The  danger  in  the  effort  of  universities  to  make  their  courses 
"practical"  in  response  to  this  situation,  is  that  the  specialized 
and  technical  courses  will  begin  too  early  in  the  student's  life. 
The  value  of  a  college  education  for  the  modern  manager  is 
not  in  the  detailed  knowledge  about  industry  which  it  imparts 
to  the  student,  but  in  the  ability  it  gives  him  to  handle  all  prob- 
lems intelligently,  scientifically  and  with  a  proper  sense  of  per- 
spective as  between  economic  and  human  values.  Executives 
who  seek  to  recruit  their  staffs  from  the  universities  will  therefore 
be  doing  themselves  the  best  service  in  the  long  run  if  they  in- 
terest themselves  in  getting  good  technical  courses  into  the 
graduate  schools  of  business  administration;  and  leave  the 
undergraduate  schools  to  provide  the  background  of  a  truly 
liberal  education  in  which  the  general  fields  of  history,  the 
natural  sciences  and  the  social  sciences  including,  psychology, 
are  covered. 

Conclusion. — The  training  of  executives  is  thus  in  the  last 
analysis  only  partially  a  responsibility  of  industry.  Intelligent 
leadership  in  industry,  as  in  the  other  fields  of  human  effort, 
is  a  public  asset.  It  will  result  in  the  production  of  more, 
better  and  cheaper  goods  than  we  now  have;  and  in  a  more 
humanized  industrial  order.  Any  educational  project  which 
takes  individuals  who  either  are  or  will  be  in  directive  positions 
in  industry,  and  makes  them  more  competent  in  any  way,  is 
usefully  forwarding  the  movement  to  improve  the  quality  of 
the  administrative  life  of  industry.  And  until  that  is  improved 
the  program  of  factory  organization  and  policy  which  this  book 
is  unfolding  can  never  come  to  its  fullest  and  finest  development. 

Selected  References 

ALLEN,   C.   R.     Instructor,   the   Man  and  the  Job.     Philadelphia,  J.  B. 
Lippincott  Co.,  1919. 

BEATTY,   A.   J.     Corporation   Schools.     Bloomington,   HI.     Public  School 
Pub.  Co.,  1918.     (School  &  Home  Education  Monographs  No.  2.) 

BOGARDUS,  E.  S.     Essentials  of  Social  Psychology.    Los  Angeles,  Univ.  of 

Southern  California,  pr.,  1918,  ch.  VII. 

1  DEWEY,  JOHN.    Democracy  and  Education;  an  Introduction  to  the  Phi- 
losophy of  Education.     N.  Y.,  Macmillan  Co.,  1916. 

DBWEY,  JOHN.    How  We  Think.    Boston,  D.  C.  Heath  &  Co.,  1910. 

DIETZ,  J.  W.    Some  Improvements  in  Existing  Training  Systems.     (In 
Annals  Am.  Acad.  v.  65,  pp.  244-251,  May,  1916.) 


152  PERSONNEL  ADMINISTRATION 


,  H.  L.     Industrial  Leadership.     New  Haven,  Conn.,  Yale  Univer- 

sity pr.,  1916,  pp.  1-29. 
GANTT,  H.  L.    Organizing  for  Work.     N.  Y.,    Harcourt,  Brace  &  Howe, 

1919,  pp.  16-22. 
GILBRETH,   F.   B.   and  L.    M.    Three  Position   Plan  of  Promotion.     (In 

Annals  Am.  Aead.,  v.  65,  pp.  289-296,  May,  1916.) 
GOWIN,  E.  B.     The  Executive  and  His  Control  of  Men;  a  Study  in  Per- 

sonal Efficiency.     N.  Y.,  Macmillan  Co.,  1919. 
GOWIN,  E.  B.    Selection  and  Training  of  the  Business  Executive.     N.  Y. 

Macmillan  Co.,  1918. 
GOWIN,  E.  B.    Developing  Executive  Ability.     N.  Y.,  Ronald  Press  Co., 

1919. 
GULICK,  L.  H.     Mind  and  Work.     Garden  City,  N.  Y.,  Doubleday,  Page 

&  Co.,  1908. 
HOBSON,  J.  A.     Industrial  System.     N.  Y.,  Longmans,  Green  &  Co.,  1909, 

pp.  145-129. 
HOBSON,  J.  A.    Work   and  Wealth.     N.   Y.,   Macmillan   Co.,    1916,   pp. 

44-59,  310-319. 
JONES,   E.   D.     Administration  of  Industrial  Enterprises.     N.  Y.,  Long- 

mans, Green  &  Co.,  1918,  pp.  1-20. 
JONES,  E.  D.    The  Business  Administrator.     N.   Y.,   Engineering  Maga- 

zine Co.,  1914. 
LINK,  H.  C.     Employment  Psychology.     N.  Y.,  Macmillan  Co.,  1919,  pp. 

188-209. 
MANN,  C.  R.    Study  of  Engineerng  Education.     N.  Y.,  Carnegie  Foun- 

dation for  the  Advancement  of  Teaching,  1918.     (Bui.  No.  11.) 
NATIONAL  ASSOCIATION  OF  CORPORATION  SCHOOLS.     Committee  on  Ex- 

ecutive Training.     Report  (In  National  Association  of  Corporation 

Schools.     7th  Annual  Proceedings,  Addresses,  Reports,  etc.,   1919,  pp. 

74-84.) 
NATIONAL  ASSOCIATION  OF  CORPORATION  SCHOOLS.    Committee  on  Voca- 

tional Guidance.     Instruction  and  Training  of  Executives.     (In  Na- 

tional  Association  of  Corporation  Schools.     4th  Annual  Convention. 

Addresses,  Reports,  etc.,  1916,  pp.  326-336.) 
PERSON,    H.    S.     University    Schools    of    Business  and   the   Training  of 

Employment  Executives.     (In  Annals  Am.  Acad.  v.  65,  pp.  117-127. 

May,  1916.) 
KISSKI..  BERTRAND.    Why  Men  Fight.    N.  Y.,  Century  Co.,  1917,  pp. 

153-181. 
SOUTHERN  PACIFIC  COMPANY.    Student  Course  in  Railroading.    San  Fran- 

cisco, 968  Flood  Bldg.,  Southern  Pacific  Co.,  n.d. 
TAOSSIG.  F.  W.    Inventors  and  Money  Makers.     N.  Y.,  Macmillan  Co., 

1915. 
TAUBSIO,  F.  W.    Principles  of  Economics.     N.  Y.,  Macmillan  Co.,  1918, 

v.  1,  pp.  105-110. 
TUCKER,  W.  J.    Personal  Power.    N.  Y.,  Houghton,  Mifflin  Co.,  1910 


CHAPTER  XII 

THE  PROBLEM  OF  FOREMANSHIP 

The  problem  of  foremanship  is  two-fold.  It  is  a  problem  of 
function  and  of  individual  competency.  What  is  the  foreman 
expected  to  do?  And  is  he  competent  to  do  it?  If  the  answer 
in  many  cases  is  that  he  is  not  adequate  to  his  task,  a  final  ques- 
tion is:  How  can  he  be  made  so? 

The  fact  that  these  questions  are  being  put  on  all  sides  at  the 
present  moment  indicates  widespread  appreciation  of  the  im- 
portance of  the  foreman's  position.  Managers  are  realizing 
that  a  company's  labor  policy  is  no  sounder  than  the  actual 
working  policy  of  each  of  its  foremen.  For  it  is  literally  true 
that  in  the  eyes  of  the  workers,  the  foreman  is  the  company. 
He  it  is  who  embodies  and  exemplifies  in  concrete  practice, 
the  company's  treatment  of  its  employees.  Is  it  any  wonder, 
therefore,  that  everyone  is  now  expressing  concern  about  the  com- 
petency and  the  equipment  of  the  foremen?  Production  execu- 
tive joins  with  employment  executive  in  demanding  that  the 
head  of  every  department  shall  be  a  man  qualified  by  native 
ability  and  by  training  for  the  responsible  position  he  has  assumed. 

The  elements  of  the  problem  of  foremanship  will  be  most 
readily  understood  if  we  undertake  a  brief  examination  into  the 
foreman's  character  and  attitude,  and  into  the  task  he  has  be- 
fore him.  Little  real  progress  will  be  made  until  the  psychology 
of  the  average  foreman  is  kept  sympathetically  in  mind. 

The  attitude  of  the  usual  foreman  is  colored  by  four  facts: 
His  success  in  rising  from  the  ranks;  his  lack  of  education;  his 
fatigue;  and  his  effort  to  overcome  a  sense  of  divided  loyalty. 
To  rise  from  the  ranks  is  no  mean  achievement.  It  implies 
more  than  average  physical  and  nervous  energy,  ability  to  "take 
knocks,"  technical  knowledge,  patience,  docility,  and  ability 
to  get  work  out  of  people,  either  by  driving  or  by  persuasion. 
Almost  inevitably  an  attitude  toward  one's  fellow  workers 
creeps  in,  which  is  a  combination  of  disgust  at  their  inferiority, 
scorn  at  their  lack  of  ambition  and  pity  at  their  failure  to  arrive. 
What  has  been  observed  of  others  is  true  of  foremen :  They  are 

153 


154  PERSONNEL  ADMINISTRATION 

in  danger  of  spurning  "the  rungs  by  which  they  did  ascend/' 
One  may  object  that  this  characterization  is  overdrawn;  but 
let  the  doubter  really  go  behind  the  scenes  in  the  minds  of  a 
number  of  foremen  and  something  closely  resembling  this  com- 
plex attitude  will  frequently  be  found. 

The  reason  why  this  narrow  attitude  may  persist  throughout 
life  is  that  the  foreman's  standards  of  value  are  frequently  re- 
stricted because  of  lack  of  education.  He  has  usually  left  school 
at  the  completion  of  the  grammar  grades;  and  there  is  no  one 
who  is  so  confident  in  his  own  knowledge  as  the  self-made  man. 
The  fact  that  he  has  done  thus  and  so  "for  twenty  years"  and 
been  successful  is  for  him  the  best  evidence  that  no  better  method 
of  procedure  need  be  sought.  It  has  frequently  been  observed 
with  truth  by  industrial  consultants  in  various  fields,  that  the 
obstacle  to  changes  and  improvements  come  more  from  foremen 
than  from  either  managers  or  manual  workers. 

There  is  also  a  strong  element  of  accumulated  fatigue  of  body 
and  mind  that  may  affect  the  foreman's  outlook.  It  is  only  by 
dint  of  hard  work  over  long  hours  with  generous  donations  of 
overtime  and  home  work  that  his  advance  has  been  made.  He 
is  often  the  first  man  in  his  department  in  the  morning  and  the 
last  to  leave  it  at  night.  Add  to  this  the  fact  that  too  many  and 
too  diverse  duties  are  often  placed  upon  him,  and  it  becomes 
literally  true  that  the  foreman  is  chronically  tired  out. 

And,  finally,  he  has  for  some  time  been  trying  to  throw  his  lot 
wholeheartedly  with  that  of  the  company.  His  fellow  workers 
for  reasons  that  they  cannot  always  voice  coherently,  but  which 
they  feel  strongly,  have  not  approached  their  work  in  quite  his 
loyal,  wholehearted  spirit.  They  have  felt  instinctively  that  on 
certain  points  their  desires  diverge  from  those  of  the  company  and 
give  rise  to  demands  for  more  leisure,  more  pay,  greater  security. 
The  foreman  has  felt  this  divergence  too;  but  he  has  suppressed  it 
— has  taken  the  deciding  step  and  become  a  "company  man," — 
and  he  knows  from  experience  only  too  well  the  points  at  which 
he,  as  company  representative,  must  try  to  persuade  or  cajole 
workers  into  conformity  with  the  company's  desires.  In  this 
situation  it  is  hard  to  prevent  an  attitude  of  mutual  suspicion 
in  which  foreman  and  workers  are  both  playing  a  game  to  see 
which  can  give  as  little  and  get  as  much  as  possible. 

The  plain  fact  is,  therefore,  that  unless  the  foreman  is  a  remark- 
able fellow  he  is  likely  to  be  in  the  wrong  mental  attitude  to  deal 


THE  PROBLEM  OF  FOREMANSH1P  155 

with  workers.  It  is  not  a  matter  for  blame;  the  foreman  is 
simply  the  victim  in  his  own  field  of  the  rapid  growth  of  the  indus- 
trial system.  His  position  nevertheless  calls  urgently  for  under- 
standing and  correction. 

The  Foreman's  Job  Today. — But  there  is  another  element  to 
consider — the  changing  character  of  the  foreman's  job.  The 
all-around  line  foreman  is  still  typical,  especially  in  the  smaller 
plants.  His  duties  have  been  many.  He  has  been  expected 
to  fix  rates,  fix  costs,  supervise  machine  installation  and  repair, 
hire  workers,  keep  production  records,  inspect  work,  train  new 
employees,  advise  on  process  changes,  and  secure  the  required 
output.  He  would  indeed  be  a  paragon  who  in  this  confusion 
of  duties  could  be  solicitous  about  the  niceties  of  human  rela- 
tions. Inevitably  in  the  past  there  has  been  overwork  on  the 
one  hand  and  neglect  of  important  functions  on  the  other. 

The  pendulum  began  to  swing  rapidly  to  the  other  extreme, 
however,  several  years  ago  under  the  impetus  of  the  scientific 
management  conception  of  "functional  foremanship."  Instead 
of  one  all-powerful  foreman,  plants  which  adopted  scientific 
management  in  modified  form  created  a  mechanical  department 
to  look  out  for  machine  maintenance,  a  research  department  to 
provide  formulae  and  standard  practice,  a  cost  department  to 
figure  costs,  a  planning  department  to  plan  and  assign  the  work, 
a  stores  department  to  deliver  materials,  a  personnel  depart- 
ment to  select  and  train  workers.  And  the  foreman  found  him- 
self surrounded  by  specialists  who  were  encroaching  upon  his 
preserves  in  every  direction — apparently  leaving  him  little  to 
do,  but  after  all  insisting  that  he  administer  the  plans  which  they 
proposed.  In  other  words,  although  starting  out  with  extensive 
staff  functionalization  with  the  foreman  as  a  mere  agent,  the 
movement  has  been  gradually  to  reinstate  him  in  a  position  of 
real  importance.  The  tendency  is  strongly  toward  a  swing  back 
from  extreme  centralized  functionalization  toward  a  more  depart- 
mental functionalization  which  we  shall  discuss  at  the  end  of 
this  chapter. 

The  point  at  which  many  progressive  managements  find  them- 
selves today  is  one  where  the  degree  of  functionalization  is  not 
altogether  clear;  where  the  foreman's  job  is,  therefore,  not  specific 
and  where  his  relation  to  the  functional  experts  of  the  staff  has 
still  to  be  worked  out.  Thus  no  answer  to  our  question,  how 
can  the  foreman  be  made  adequate  to  his  job,  is  possible  until 


156  PERSONNEL  ADMINISTRATION 

we  have  that  job  definitely  pictured.  Then  we  can  answer  the 
question  from  three  points  of  view.  We  can  tell  what  the  fore- 
man should  be,  should  know  and  should  do. 

In  other  words,  we  need  an  analysis  of  the  foreman's  job  as  it 
is  today  conceived  in  progressive  plants — a  statement  of  his 
duties,  relations  and  responsibilities.  In  the  first  instance,  as 
a  vital  part  of  the  education  and  reorganization  of  the  whole 
executive  staff  it  will  be  valuable  for  the  executive  (or  outside 
consultant)  who  has  it  in  charge,  to  get  each  foreman  to  make  a 
written  statement  of  his  conception  of  his  job,  in  which  he 
lists  his  duties  as  fully  and  specifically  as  possible.  This  will 
serve  as  a  basis  for  comparison  but  can  be  considered  as  noth- 
ing more  than  suggestive  since  the  definite  formulation  of  the 
duties  of  any  job  is  one  of  the  most  difficult  of  analytical 
tasks,  one  requiring  close  observation  over  a  period  of  time  to 
bring  it  to  accurate  completion. 

The  Foreman's  Function. — The  real  problem  is  to  see  what 
the  foreman's  work  is  in  relation  to  that  of  such  staff  executives 
as  those  in  charge  of  planning,  efficiency,  costs,  employment,  train- 
ing, etc.  It  will  probably  be  discovered  that  the  foreman  is  in  al- 
most continual  contact  with  one  or  another  of  these  functionaries. 
Either  they  are  referring  to  him  for  information  or  he  to  them  for 
advice.  But  it  is  usually  implicit  in  the  relationship  that  he  is  the 
man  who  is  charged  with  the  responsibility  for  running  his  department; 
for  seeing  to  it  that  the  several  special  methods  and  procedures  in- 
stalled at  the  behest  of  the  staff  experts  faep  running  smoothly 
and  effectively.  They  are  definitely  advisory  and  consultative  in 
function;  he  is  the  executive.  This  by  no  means  exhausts  the 
problem  of  his  i  elation  to  them.  We  return  to  this  question  in 
discussing  what  the  foreman  should  do. 

Briefly,  the  foreman  is  responsible  for  the  coordination  of  the 
work  of  those  under  him,  with  the  work  of  those  in  preceding  and 
succeeding  departments,  and  with  that  of  the  several  rtaff  ex- 
ecutives. (We  are  leaving  out  of  account  at  this  time  all  icfer- 
ence  to  those  few  plants  where  the  purely  functional  foreman 
operates.  This  is  the  "  departmental  f unctionalization "  which 
will  be  discussed  later).  He  is,  then,  the  directive  head,  the  one 
who  ordinarily  has  the  last  word  in  deciding  how  adopted  poli- 
cies shall  be  executed.  This  Nummary  statement  of  his  duties 
by  no  means  constitutes  a  job  analysis,  which  should  include  a 
statement  of  the  specific  knowledge  about  technique  and  process 


THE  PROBLEM  OF  FOREMANSHIP  157 

necessary  for  the  foreman,  the  relative  time  required  by  different 
elements  of  this  job,  a  statement  of  the  mental  qualifications  and 
aptitudes  especially  required,  etc.  But  this  conception  of  the 
foreman  as  the  executive  head  of  a  department,  working  in  close  con- 
j  unction  with  a  variety  of  special  advisory  experts,  does  define 
his  function  in  a  way  which  will  probably  be  looked  upon  as 
sound  organization  for  some  time  to  come. 

With  this  conception  in  mind  we  can  proceed  to  discuss  the 
necessary  qualifications  of  the  foreman;  what  he  should  be,  know 
and  do. 

Clearly  he  should  under  ordinary  conditions  be  a  man  possess- 
ing qualities  of  leadership  and  executive  ability.  He  should  be 
able  to  give  instructions  in  a  way  that  commands  not  simply 
respect  but  confidence,  goodwill  and  willingness  to  comply. 
The  necessary  extent  of  his  technical  knowledge  will  vary  con- 
siderably with  the  industry,  but  it  is  surely  true  that  the  best 
workman  does  not  necessarily  make  the  best  foremen.  Selection 
of  the  properly  qualified  person  will  be  made  of  course  in  the 
light  of  the  job  analysis  of  the  foreman's  position  in  each  depart- 
ment. But  the  task  of  selecting  the  foreman  should  be  compara- 
tively simple  since  the  selective  work  should  be  done  at  an  earlier 
stage.  There  would  normally  be  one  or  two  "logical  candidates " 
for  the  job.  It  will  usually  be  true  that  it  is  from  among  gang 
bosses,  straw  bosses,  and  foreman's  assistants  that  the  material 
out  of  which  foremen  are  made  is  to  be  found.  These  lesser 
executives  should  in  fact  be  picked  with  this  ultimate  promotion 
in  mind.  To  have  them  understudy  the  foreman,  and  act  occa- 
sionally in  his  place  when  he  is  absent,  will  help  to  make  the 
selective  process  more  sure.  The  workers  who  have  directive 
interests  and  ability  will  thus  tend  to  come  to  the  front  in 
perfectly  natural  ways  if  the  foremen  and  those  responsible  for 
training  executives  are  watchful  and  careful  in  the  advancement  of 
workers  to  positions  as  gang  leaders  and  assistants. 

Not  the  least  important  condition  of  having  the  selection  and 
training  of  foremen  effectively  handled  is  to  assign  this  function 
to  one  or  two  individuals — -preferably  members  of  the  personnel 
department.  To  be  sure  the  selection  of  foremen  should  never 
be  made  without  the  closest  conference  with  the  plant-and- 
process  superintendent,  since  the  foremen's  duties  divide  fairly 
equally  between  problems  of  process  and  problems  of  personnel. 
But  the  work  of  continually  looking  about  in  the  shop  for 


158  PERSONNEL  ADMINISTRATION 

potential  executive  timber  and  of  giving  it  encouragement,  is 
a  job  in  the  field  of  human  relations. 

The  foreman,  therefore,  should  be  the  man  in  the  department 
who  is  most  respected  as  leader,  who  is  regarded  as  the  coordi- 
nator of  the  efforts  of  his  associates  and  the  guiding  mind  of  the 
numerous  activities  in  his  room.  The  personnel  department 
should  be  responsible  foi  picking  out  understudies  and  assistants 
who  are  believed  to  be  capable  of  advancement — and  should  be 
active  in  assisting  native  ability  by  formal  instruction.  It  is 
not  unlikely  that  objective  methods  of  testing  intelligence  and 
of  comparative  rating  can  help  to  make  these  selections  less 
arbitrary  and  more  uniformly  successful.  We  have  in  discus- 
sing selective  tests  (Chapter  VI)  dealt  with  the  use  of  rating 
scales  for  executives. 

Instruction  for  Foremanship. — The  work  of  instruction  divides 
itself  into  two  parts:  Training  the  man  who  is  becoming  a  fore- 
man, and  training  those  already  on  the  job. 

As  to  the  first,  there  is  a  growing  body  of  interesting  and  sug- 
gestive experience.  The  method  of  formal  understudy  by  an 
assistant  foreman  is  in  itself  educational;  but  the  assistant's 
progress  will  be  much  faster  if  his  shop  experience  is  supplemented 
and  interpreted  in  various  ways.  For  example,  where  technical 
evening  schools  are  available,  he  should  be  encouraged  to  attend 
them  and  efforts  should  be  made  by  acquaintance  with  the 
school's  teacher  to  relate  his  theoretical  instruction  and  his 
practical  duties  as  closely  as  possible.  The  value  of  regular 
class-room  instruction  for  assistant  foremen  is  also  great.  The 
subject  matter  of  the  curriculum  need  not  differ  substantially 
from  that  in  similar  courses  given  to  foremen;  and  we  shall 
consider  the  content  of  the  curriculum  in  that  connection.  This 
study  should  be  supplemented  by  the  shifting  of  the  understudy 
at  regular  three  or  six  months'  intervals  from  department  to 
department  to  get  a  working  knowledge  of  the  plant  and  processes 
as  a  whole. 

In  this  training  plan,  a  three  months'  period  in  the  personnel 
department  may  well  be  included,  since  one  of  the  most  essen- 
tial points  in  the  success  of  the  prospective  foreman  is  that  he 
have  a  cordial  and  understanding  relation  with  that  department, 
and  that  he  absorb  and  adopt  as  much  as  possible  of  the  spirit 
and  point  of  view  with  which  it  works.  The  employment  ad- 
ministrator should  consequently  aim  to  have  the  understudy  see 


THE  PROBLEM  OF  FOREMANSHIP  159 

and  participate  in  as  many  different  phases  of  the  human  relations 
work  as  possible.  He  may,  for  example,  be  required  to  interview 
for  a  month,  help  in  training  for  a  month,  help  administer  per- 
sonal adjustments  and  service  features  and  so  on.  Finally, 
wherever  possible,  it  is  of  great  value  to  let  the  student  see  the 
inside  of  other  plants.  No  one  thing  can  so  completely  efface 
the  complacency  of  the  man  who  has  always  worked  in  only  one 
or  two  shops,  as  to  see  the  different,  and  often  better,  methods 
in  use  elsewhere. 

The  training  of  foremen  themselves  is  happily  receiving  wide 
attention  today.1  Outstanding  among  the  methods  which  are 
being  found  successful  are  the  following: 

Foremen's  classes  are  being  formed  which  meet  preferably  on 
company  time  toward  the  end  of  the  afternoon,  for  formal  in- 
struction. This  instruction  is  given  by  a  trained  teacher,  se- 
lected first  because  of  his  ability  to  present  a  subject  or 
conduct  a  discussion  in  a  clear,  orderly  and  interesting  fashion 
and  second  because  of  his  acquaintance  with  the  particular 
industry. 

The  method  of  instruction  should  be  one  adapted  to  adults; 
that  is,  it  should  be  more  a  conference  than  a  class.  The  instructor 
should  aim  not  so  much  to  deliver  himself  of  knowledge  as  to 
bring  out,  organize  and  make  vivid  the  knowledge  which  is 
often  to  a  large  extent  already  present  in  the  group.  More  ground 
can  be  covered  and  more  systematic  presentation  assured,  if 
well  selected  outside  reading,  amounting  to  not  over  seventy  or 
eighty  pages  a  week,  is  assigned. 

Classes  should  be  small,  containing  not  more  than  twenty  or 
twenty-five  members.  Sessions  should  be  held  at  least  weekly 
and  preferably  twice  a  week,  running  over  a  period  of  fifteen  or 
twenty  weeks.  It  is  better  to  run  different  courses  over  a  number 
of  years  than  to  work  the  foremen  to  the  point  of  fatigue  and 
lack  of  interest  in  one  long  exhaustive  course. 

Enrollment  should  be  optional,  but  once  enrolled  the  foreman 
should  be  expected  to  attend  regularly.  With  a  little  personal 
work,  however,  it  may  be  possible  to  bring  practically  all  the 
minor  executives  to  the  point  of  attendance. 

The  subject  matter  of  the  curriculum  should  include  the 
following: 

See  SLIGHTER,   SUMNER  H.     The  Turnover  of   Factory  Labor,    1919> 
pp.  380-86,  for  further  valuable  suggestions. 


160  PERSONNEL  ADMINISTRATION 

(a)  History  and  development  of  the  industry. 

(6)  Raw  materials  and  stores  keeping. 

(r)   Planning,  routing  scheduling  of  work. 

(rf)  Technique  of  actual  manufacture. 

(e)  Working  conditions. 

(/)   Technique  of  leadership,  handling  of  workers  and  other  matters 

of  personnel  administration. 
(0)  Selling  and  financial  problems. 
(h)  General  problems  of  elementary'  economics. 
Irt  'Pv-v.j.c  ^--!»-ri»v.  S. 

It  will  be  useful  to  make  use  of  technical  experts  like  buyers, 
chemists,  accountants,  etc.,  to  explain  their  several  fields;  and 
to  make  use  of  actual  first  hand  data  as  much  as  possible.  This 
means  visits  within  the  plant  and  to  other  plants,  the  use  of 
moving  pictures,  models,  samples  and  any  other  graphic  methods 
of  showing  ideas  at  work. 

It  should  be  remembered  that  the  foreman,  in  this  suggested 
arrangement  of  work,  will  be  able  to  give  time  to  improving 
the  operation  of  his  department.  Yet  despite  this  fact  and 
even  after  further  training,  a  tendency  to  passivity  is  a  dan- 
ger to  be  guarded  against.  For  a  foreman  surrounded  by  staff 
advisors  is  likely  to  assume  that  they  and  not  he  should  be 
initiators,  and  may  thus  remain  unaggressive  and  routine  in 
outlook.  The  dynamic  nature  of  his  job  can,  therefore,  hardly 
be  over-stressed  in  the  course  of  all  the  educational  work.  The 
foreman  should  be  made  to  realize  that  he  is  the  one  who,  if 
he  is  energetic,  ingenious  and  imaginative,  is  peculiarly  in  a 
position  to  see  how  his  department  as  a  whole  could  be  run  more 
economically  and  more  productively.  Indeed,  the  entire  educa- 
tional work  of  the  factory  is  not  to  assure  that  the  plant  as  it  is 
shall  run  smoothly,  but  that  it  shall  become  under  the  creative  interest 
of  all  those  at  work  a  far  more  effective  instrument  of  production. 

Some  plants  have  found  great  value  in  a  weekly  foremen's 
conference  at  which  one  of  the  number  reads  a  prepared  paper 
on  some  aspect  of  his  work  and  then  leads  a  discussion  on  it. 
The  shortcoming  of  this  method  is  that  it  does  not  provide 
sufficient  leadership  to  hold  the  group  to  an  organized  and  cumu- 
latively valuable  train  of  thought.  It  ignores  important  peda- 
gogical values,  which  can  only  be  kept  constantly  in  sight  where 
a  real  teacher  is  employed. 

It  may  be  objected  that  in  small  plants  this  type  of  educational 
work,  while  necessary,  would  not  warrant  the  full-time  use  of 


THE  PROBLEM  OF  FOREMANSHIP  161 

a  training  executive.  This  may  be  true,  in  which  case  there  are 
two  or  three  possible  ways  out;  cooperate  with  other  local  factories 
to  bring  in  a  teacher;  secure  the  service  of  a  teacher  on  part  time 
to  lay  out  the  curriculum  and  direct  the  classes;  or  get  local 
educational  agencies  to  start  special  foremen's  classes  in  the 
evening. 

No  factory  is  too  small,  however,  to  have  a  well-selected 
technical  library  with  files  of  the  current  technical,  and  trade 
journals  on  hand.  The  employment  administrator  should  make 
it  his  business  to  see  that  these  trade  papers  are  circulated  and 
read, — especially  marked  articles  of  particular  value. 

The  educational  value  of  a  foremen's  council  is  noteworthy, 
but  it  is  an  education  which  comes  rather  in  the  doing  than  by 
some  consciously  educational  process.  We  therefore  defer 
its  consideration  for  the  moment. 

The  development  of  a  certain  amount  of  esprit  de  corps  among 
the  foremen  is  also  definitely  valuable  and  it  has  usually  to  be 
consciously  striven  for.1  The  educational  work  will  thus  be 
most  fruitful  if  it  is  supplemented  by  a  moderate  amount  of  purely 
social  organization.  A  foremen's  club  for  social  purposes  only 
should  supply  this  need.  Monthly  evening  meetings  at  which 
congenial  and  varied  entertainment  is  provided,  always  help 
toward  the  creation  of  friendly  feeling.  They  serve  the  legiti- 
mate purpose  of  developing  a  sense  of  fellowship  among  working 
colleagues — a  sense  at  once  pleasurable  and  worthwhile  in  itself, 
and  productive  of  greater  harmony  in  the  work  of  the  factory. 
These  gatherings  should,  however,  be  as  autonomous  as  possible; 
any  leadership  which  it  may  be  necessary  for  the  employment 
administrator  to  exert  should  be  exerted  by  methods  of  indirec- 
tion and  personal  suggestion  rather  than  by  active  direction. 
Nor  should  it  be  thought  that  there  is  anything  dubious  about 
such  a  method;  it  is  essentially  the  method  of  democracy.  It 
is  the  method  which  realizes  that  only  as  the  active  and  forceful 
agents  in  an  organization  are  supplied  with  good  ideas  which 
they  submit  for  popular  approval  and  consent,  can  progress 
take  place. 

Indeed,  it  may  well  be  said  here  that  much  of  the  most  effective 

1  Note   in  this   connection   this   sentence   by    Robert    B.    Wolf:    "The 
only  kind  of  an  organization  that  will  have  a  permanent  esprit  de  corps  is 
the  kind  where  the  creative  power  of  the  individual  is  free  to  express  his 
real  inner  spirit."     System,  v.  35,  p.  35.     January,  1919. 
11 


162  PERSONNEL  ADMINISTRATION 

work  of  the  personnel  manager  will  be  done  in  this  indirect  way. 
He  will  plant  the  seed  of  new  ideas  in  the  minds  of  those  who  have 
executive  responsibility  and  then  will  not  be  too  eager  to  claim  credit 
for  the  ideas  when  the  executive  or  foreman  appears  several  weeks 
or  months  later  and  proposes  them  as  his  own. 

There  are  many  variants  upon  this  proposal  for  occasional  social 
activities  among  foremen;  dinners  with  the  head  executives, 
bowling  clubs,  theater  parties,  annual  picnics  and  the  like. 
All  can  serve  a  good  purpose;  yet  it  is  important  not  to  overdo 
them.  It  would  be  most  shortsighted  for  the  factory  to  try  to 
supply  the  social  life,  either  of  its  minor  executives  or  its  workers. 
This  would  be  a  narrowing  experience,  altogether  too  artificial 
and  constricted  in  the  social  and  recreational  group  set  up. 

An  increasing  number  of  corporations  are  finding  educational 
value  in  relieving  the  foremen  of  his  departmental  duties  and  using 
him  in  the  personnel  department  for  a  period  of  three  months. 
Where  this  department  is  ably  led  and  is  functioning  smoothly, 
such  a  temporary  transfer  has  benefits  for  both  sides.  And  the 
eventual  result  from  the  human  relations  point  of  view  is  that  all 
the  foremen  have  helped  the  employment  side  of  the  business  to 
function,  and  have  seen  at  first  hand  its  problems  and  difficulties. 
Inasmuch  as  the  watchword  of  successful  employment  adminis- 
tration is  not  authority  but  salesmanship,  it  should  be  appreci- 
ated that  the  foreman  can  be  better  "sold"  to  personnel  work 
in  this  way  than  by  any  amount  of  theoretical  discussion. 

In  short,  there  is  a  variety  of  methods  but  one  object;  numerous 
roads  but  one  goal.  And  that  goal  is  to  have  foremen  in 
the  organization  in  every  respect  qualified  for  the  executive 
responsibilities  they  are  expected  to  assume.  Those  qualifica- 
tions are  to  be  secured  not  by  lamenting  over  the  shortcomings 
of  the  foremen,  but  by  taking  action  to  correct  them. 

And  one  of  the  prime  correctives  must  come  in  proper  organiza- 
tion for  the  doing  of  the  job  itself.  Executive  action  can  always 
be  educational  to  the  executive,  if  only  he  will  act  after  taking  counsel 
with  those  who  have  given  special  problems  special  study.  In 
a  factory  of  any  size,  this  can  be  achieved,  at  least  in  the  begin- 
ning, only  by  a  rather  unusual  degree  of  conscious  organization 
among  staff  and  line  executives.  We  come  back  therefore  to 
our  former  question :  What  should  the  foreman  do  in  order  to 
assure  effective  administration?  But  the  answer  to  this  involves 
us  in  two  other  problems:  First,  the  foreman's  relation  to  staff 


THE  PROBLEM  OF  FOREMANSHIP  163 

executives,  other  foremen  and  workers;  and  second,  the  organ- 
ization of  the  relationship  in  such  a  manner  that  it  is  always 
mutually  effective  and  harmonious. 

Foremen  and  Experts. — The  first  problem  involves  the  moot 
question  of  the  relation  of  the  foreman  to  the  expert.  We  have 
said  above  that  the  foreman  is  the  directive  head  of  his  depart- 
ment. But  to-day  we  have  efficiency  experts,  planning  experts, 
process  experts,  cost  and  rate  experts,  to  say  nothing  of  the  experts 
in  the  field  of  personnel, — all  full  of  ideas  for  improvements; 
all  anxious  to  get  their  ideas  installed  at  once.  And  at  the 
head  of  each  department  stands  an  executive  who  nine  times 
out  of  ten  is  on  the  defensive  as  soon  as  a  new  idea  is  broached. 
How  under  these  conditions  are  changes  to  be  affected? 

Full  answer  to  this  whole  question  is  reserved  for  discussion 
in  the  chapter  on  the  coordination  of  departments  (Chapter 
XXVI).  We  shall  discuss  there  especially  how  the  larger 
staff  policies  are  decided  upon  and  transmitted  to  the  whole 
organization.  We  are  assuming  here  that  these  policies  have 
been  decided  and  that  those  which  remain  to  decide  relate  to 
details  of  methods.  If  our  discussion  seems  to  imply  an  over- 
organization,  it  should  be  remembered  that  this  is  deliberately 
done  in  order  to  get  the  several  functions  and  relationships 
clearly  distinguished. 

We  have  already  mentioned  the  foremen's  council.  This 
should  be  the  organized  body  of  all  the  foremen,  who  meet  weekly 
or  bi-weekly  to  discuss  all  production  matters  which  affect  them. 
If  the  training  staff  or  the  cost  department,  for  example,  have 
some  innovation  which  the  head  executives  have  agreed  to  back, 
this  should  be  presented  to  the  foremen  at  one  of  these  meetings. 
But  this  presentation  should  usually  be  preceded  by  individual 
conference  with  all  the  foremen  in  their  own  departments.  There  is 
no  substitute  for  the  individual  contact  of  expert  with  foremen, 
in  the  course  of  which  the  expert  tries  to  "make  himself  solid 
with  the  foremen"  and  get  his  idea  across.  This  personal 
educational  work  may  seem  to  be  prodigal  of  time  where  several 
score  of  foremen  are  involved;  but  progress  comes  in  the  wise 
administration  of  a  factory  no  faster  than  it  comes  in  the  mind 
of  every  individual  executive.  We  are  building  from  the  ground 
up  and  for  all  time  only  as  we  carry  conviction  with  every 
foreman  regarding  changes  that  are  made.  Before  all  organized 
efforts,  then,  come  personal  efforts;  and  if  it  proves  impossible  to 


164  PERSONNEL  ADMINISTRATION 

win  assent  to  a  new  proposal  from  one  or  two  particularly  hard- 
headed  fellows  in  private,  it  may  then  be  useful  for  them  in  a 
meeting  to  see  in  what  a  minority  they  are. 

The  value  of  planting  the  seed  of  a  new  idea  and  waiting 
patiently  for  developments  should  be  clearly  seen.  The  expert 
who  is  content  to  till  the  soil  and  then  let  the  earth  of  itself 
and  in  its  own  good  time  bring  forth  the  fruit,  is  the  one  who  gets 
ahead  fastest  in  the  long  run.  There  is  a  saying  which  is  valu- 
able for  the  expert  to  the  effect  that,  a  demand  for  the  exercise 
of  authority  is  a  confession  of  weakness.  And  there  is  another 
saying  already  used  in  this  volume,  which  is  also  suggestive 
for  the  foreman  and  expert  in  this  connection :  The  expert  should 
be  on  tap,  not  on  top.  Both  of  the  epigrams  stress  what  we  believe 
to  be  the  vital  kernel  of  truth  about  the  foreman's  relation  to  the 
expert;  namely,  that  the  expert  cannot  safely  be  allowed  to  put 
his  ideas  into  practice  until  there  is  considerable  body  of  supporting 
opinion  witting  to  experiment  with  those  ideas  and  take  the  con- 
sequences whatever  they  may  be. 

The  foremen's  council,  then,  provides  the  representative 
assembly  with  which  the  expert  will  deal.  And  it  provides 
likewise  the  place  for  adjustments,  between  foreman  and  fore- 
man on  interdepartmental  relations. 

In  matters  of  the  application  of  new  policies  to  one  special 
department  or  operation,  further  conference  with  the  par- 
ticular foreman  is  urgently  advisable.  Where,  for  example, 
as  a  result  of  expert  study,  it  is  decided  that  changes  in  a  process 
are  desirable,  it  will  be  important  to  have  a  regular  conference 
of  expert,  foreman  and  representative  of  workers  at  the  job  in 
question,  to  go  over  the  ground  thoroughly  and  reach  an  agree- 
ment before  changes  are  introduced.1 

In  meeting  his  responsibilities  to  the  executive  above  him,  the 
foreman  can  act  competently  only  when  he  knows  "where  he  is 
at" — that  is,  when  he  has  adequate  records.  He  should,  for 
example,  be  provided  with  records  of  amounts  of  product  per 
department  and  per  producing  units  correlated  with  figures  of 
department  pay  roll,  with  comparative  figures  of  unit  costs, 
records  of  amounts  of  waste,  seconds,  rejects,  etc.,  records  of 
department  labor  turnover,  of  absence  and  lateness.  Study  of 
these  records  has  of  itself  such  great  educational  value  that  the 

1  More  extended  discussion  of  this  problem  in  relation  to  the  conduct  and 
use  of  job  analysis  will  be  found  in  Chapter  XIX. 


THE  PROBLEM  OF  FOREMANSHIP  165 

management  which  fails  to  provide  them,  is  losing  out  not  only 
in  adequate  control  of  immediate  production  but  in  longtime 
training  as  well. 

It  will  be  especially  important,  also,  for  the  foremen  to  have 
a  hand  in  the  determining  of  personnel  policies.  A  wise  scheme 
of  organization  includes  a  personnel  committee,1  which  has  the 
work  of  deciding  policies  in  this  field.  And  on  this  committee  it 
will  be  useful  for  a  representative  from  the  foremen's  council  to 
sit.  This  provides  a  proper  liaison  between  personnel  and 
process  policies;  and  means  that  no  innovation  is  contemplated  in 
matters  of  human  relations  which  the  foremen  have  not  heard  of 
and  considered. 

This  leaves  to  be  considered  the  relation  of  the  foreman  to  the 
workers  in  their  organized  capacity.  Although  this  is  really  a 
question  of  the  policies  of  employees'  organizations,2  there  are 
from  the  foreman's  point  of  view  certain  observations  to  be 
made  here.  There  is  a  tendency  in  the  shop  committee  move- 
ment as  it  is  working  out  practically  in  this  country,  to  leave  the 
foreman  as  rather  a  fifth  wheel  to  the  coach.  Even  in  the  so- 
called  "federal  plan"  which  makes  of  the  foremen  a  Senate 
Chamber,  there  appears  to  be  some  doubt  about  the  vitality 
of  the  foremen's  part  in  the  structure.  It  is  our  conclusion 
(and  is  also  the  assumption  on  which  the  most  carefully  thought 
out  employee  representation  schemes  are  planned)  that  it  is 
usually  true  that  the  foremen,  as  a  unit  group  in  the  government 
of  industry,  have  interests  which  align  them  more  usefully  with 
the  management  than  with  the  manual  workers.3  The  practical 
result  of  this  conclusion  is  a  belief  that  the  place  of  foremen  in 
employee  organizations  should  be  relatively  unimportant,  and 
especially  that  active  committees  representing  the  workers 
should  be  composed  of  manual  workers  only.  However,  as  will 
appear  later,  we  believe  that  experience  shows  that  when  it 
comes  to  important  matters  on  which  it  is  desired  that  employee 
groups  shall  act,  the  best  results  are  achieved  by  joint  committees. 
On  such  joint  standing  committees,  the  management  would 

1  Discussed  more  fully  in  Chapter  XXVI. 

2  And  will  therefore  be  treated  in  Chapter  XXVIII. 

3  Certain  unions,  however,  urge  or  even  require  foremen  to  belong  to  the 
union.     It  is  argued  in  these  cases  (e.g.,  printing)  that  the  foreman  can  so 
discriminate  in  the  amount  and  kind  of  work  given  out,  that  fair  play  is 
best  assured  if  he  also  belongs  to  the  union  and  is  therefore  answerable  to 
his  fellow  workers. 


166  PERSONNEL  ADMINISTRATION 

appoint  its  own  representatives;  and  there  is  every  reason  why 
foremen  should  act  as  management  representatives,  provided  of 
course  the  issue  under  consideration  is  not  one  in  which  they  are 
personally  involved,  such  as  a  discharge  from  their  department. 
By  the  presence  of  such  foremen  as  management  delegates  on 
standing  committees  of  employee  organizations,  a  point  of 
contact  is  established  which  serves  an  excellent  purpose.  The 
foremen  and  manual  workers  are  then  collaborating,  each  with 
their  special  point  of  view,  on  admittedly  significant  problems. 

The  interrelations  of  the  foremen  with  higher  executives  and 
with  workers,  affect  both  groups  in  so  many  ways,  that  our 
point  of  view  will  only  be  adequately  set  forth  after  a  reading  of 
the  special  chapters  on  coordination  and  employees'  organizations. 
But  enough  has  now  been  said  to  give  a  fairly  exhaustive  answer 
to  the  question  of  the  foreman's  actual  duties.  He  should  plan 
with  his  experts;  schedule  work  with  his  subordinates;  supervise 
its  execution;  study  and  act  upon  the  records  of  the  department's 
results.1  But  in  and  through  it  all  it  must  be  remembered  that 
he  touches  people  at  a  thousand  points.  His  job  fundamentally 
is  to  bring  people  into  a  relationship  and  an  attitude  where  an 
economical  production  of  goods  can  take  place.  His  real  prob- 
lem is  a  psychological  one.  And  it  is,  therefore,  of  first  importance 
that  he  be  the  kind  of  a  person  who  can  deal  successfully  with 
people.  His  success  is  measured  in  terms  of  results;  but  if  we 
can  also  find  ways  of  measuring  his  capabilities,  either  absolutely 
or  comparatively  with  those  of  other  foremen,  time  can  be  saved, 
friction  and  ill-will  avoided.  This  is  the  problem  of  rating  fore- 
men which  has  been  briefly  considered  in  the  chapter  on 
selection.* 

A  further  aspect  of  the  foremanship  problem  is  that  of  pay. 
The  increase  in  the  wage  rates  of  manual  workers  has  in  many 
plants  resulted  in  the  foreman's  getting  less  than  those  whom  he 
superintends.  Other  questions  arise,  such  as  the  relation  of  the 
foreman's  pay  to  that  of  the  most  skilled  operator,  where  the 
foreman  is  himself  highly  skilled  and  where  he  is  not  and  does 
not  have  to  be  a  skilled  worker  but  is  entirely  an  executive.  We 

1  See  in  this  connection  the  article  by  MARK  M.  JONES,  What  I  Would 
Do  If  I  Were  a  Foreman,  Industrial  Management,  v.  56,  p.  59-61,  July, 
1918. 

*  For  specimen  of  a  foremen's  rating  scale  see  Bloomfield,  Daniel,  Sel- 
ected Articles  on  Employment  Management,  pp.  220-21. 


THE  PROBLEM  OF  FOREMANSHIP  167 

reserve  discussion  of  these  questions  until  the  chapter  on 
payment  methods  (Chapter  XXIV). 

The  question  is  often  asked:  How  many  workers  should  a 
foreman  have  under  him?  No  absolute  answer  to  this  question 
is  possible.  It  depends  on  the  arrangement  of  the  workrooms, 
the  nature  of  the  process,  the  character  and  attitude  of  the 
workers.  If  a  foreman  has  too  many  workers  (i.e.  over  50  or  60) 
he  loses  personal  touch  with  them;  if  on  the  other  hand  he  has 
too  few  workers  he  is  in  danger  of  giving  the  impression  of  watch- 
ing over  them  too  closely.  And  let  the  foreman  beware  of  that; 
let  him  beware  of  "snooping  around"  his  department.  He  is 
not  a  detective  or  a  task  master,  but  an  executive.  And  if  his 
capacities  of  leadership  are  so  inferior  that  he  has  to  drive  with 
verbal  abuse  or  profanity,  or  be  on  hand  every  minute  in  order 
to  have  work  go  forward,  a  successor  should  be  found  for  his 
place.  In  general,  therefore,  a  foreman  should  have  as  many 
men  as  he  can  know  personally,  provided  he  can  at  the  same  time 
give  the  requisite  supervision,  advice  and  suggestion  about 
production  methods,  answer  the  questions  which  constantly 
arise,  deliver  the  expected  amount  of  good  quality  output  and 
have  some  time  to  devote  to  improving  his  department's  effi- 
ciency. This  would  seem  to  argue  in  most  cases  for  increasing 
the  supervisory  staff  to  a  point  where  there  is  one  foreman  for 
twenty-five  workers.  There  are  plants  where  the  productive 
efficiency  of  the  individual  departments  has  proved  to  be  in 
almost  direct  relation  to  the  increase  in  the  supervisory  staff. 
And  this  result  is  achieved  not  by  close  supervision  of  an  ob- 
jectionable sort  but  by  assistance,  intensive  training  and  better 
coordination. 

We  come,  finally,  to  consider  the  problem  of  foremanship 
where  functionalization  has  proceeded  to  the  limit.  There  are 
several  plants,  for  example,  where  a  department  instead  of  having 
one  foreman  has  three;  a  mechanical  foreman  to  keep  the  ma- 
chinery in  good  working  order;  a  process  foreman  to  direct  the 
technical  work  of  manufacture;  and  a  personnel  foreman  to 
start  the  employee  at  work,  train  him,  adjust  grievances,  etc. 
These  three  foremen  have  to  work,  of  course,  in  closest  coopera- 
tion; and  if  any  fundamental  disagreement  arises  among  them 
on  some  matter  that  affects  all  three  at  once,  it  is  referred  *0  the 
staff  executives  over  them.  For  each  functional  foreman  is 
responsible  to  his  respective  staff  executive,  chief  engineer, 


168  PERSONNEL  ADMINISTRATION 

technical  manager  or  personnel  manager,  as  the  case  may  be. 
And  it  is  ultimately  for  these  three  to  confer  and  agree  before 
policies  or  decisions  are  put  into  effect. 

In  this  type  of  organization  all  the  foremen  are  still  dealing 
with  people,  still  under  the  necessity  of  bringing  people  into  re- 
lationships and  attitudes  which  are  productive.  Hence  the 
need  for  them  to  be  effective  personalities  is  as  great  as  ever. 
Their  knowledge,  however,  does  not  have  to  be  quite  so  genera- 
lized— or  at  least  so  thorough  in  every  field — as  it  does  in  the 
case  of  the  single  foreman.  And  their  duties  are,  of  course, 
somewhat  restricted  and  specialized.  Yet  on  the  whole  the 
problem  remains  the  same;  to  get  people  in  every  executive 
position  who  can  competently  act  as  the  spokesmen  of 
management. 

There  is  a  significance  in  this  experiment  in  extreme  function- 
alization  which  should  not  be  overlooked,  even  though  it  may  be 
too  early  to  say  how  successful  it  is  and  how  adapted  to  wide- 
spread use.  It  looks  in  the  direction  of  the  decentralizing  of 
staff  work.  It  looks  in  the  direction  of  getting  the  experts  into 
closer,  more  organic  touch  with  the  actual  work  of  production. 
It  takes  the  coordination  of  staff  departments  in  a  living  way 
into  every  room  and  into  every  situation  in  the  factory.  All 
this  has  a  value  which  in  one  way  or  another  must  be  achieved 
under  any  plan  of  departmental  organization.  However  it  is  to 
be  accomplished,  and  there  is  no  room  for  dogmatism  in  dis- 
cussing the  methods,  it  is  essential  that  the  different  points 
of  view  of  the  plant,  process  and  personnel  experts  be  reconciled 
and  so  far  as  possible  harmonized  at  every  point,  if  the  work  of 
production  is  to  proceed  uninterrupted.  And  it  is  at  the  point 
where  the  foreman  is  at  work  that  this  accommodation  has  most 
frequently  to  be  made. 

This  accounts  for  the  stress  which  we  place  upon  foremanship 
as  a  "problem."  We  are  concerned,  as  all  alert  managers  are 
today,  to  have  deft  and  expert  people  undertake  the  direction 
of  each  group  of  workers.  This  is  a  sine  qua  non  of  efficient 
factory  operation.  But  different  kinds  of  experts  are  needed. 
And  the  foreman  is  hardly  to  be  blamed  for  not  preserving  a 
proper  balance  in  carrying  out  expert  advice,  if  managers  them- 
selves do  not  understand  clearly  the  relative  weight  which  each 
expert  should  have.  He  was  a  practical  man  who  said  that  as  a 
foreman,  "the  largest  part  of  my  job  is  human  relations." 


THE  PROBLEM  OF  FOREMANSHIP  169 

Selected  References 

BLOOMFIELD,  DANIEL,  ED.  New  Foremanship.  (In  his  Selected  Articles 
on  Employment  Management,  1919,  pp.  301-329.) 

FEDERAL  BOARD  FOR  VOCATIONAL  EDUCATION.  Forman  Training  Courses. 
Bui.  36.  Trade  and  Industrial  Series  No.  7.  Wash.,  Gov't.  Print.  Off., 
1920. 

JONES,  M.  M.  What  I  Would  Do  if  I  Were  a  Foreman.  (In  Industrial 
Management,  v.  56,  pp.  59—61,  July,  1918.) 

SLIGHTER,  S.  H.     Improving  the  Handling  of  Men  by  Foremen  and  Gang 

Bosses.     (In  his  Turnover  of  Factory  Labor,  1919,  pp.  372-386.) 

TEAD,  ORDWAY.  Importance  of  Being  a  Foreman.  (In  Industrial  Man- 
agement, v.  53,  pp.  353-355,  June,  1917.) 

Who  Make  the  Best  Foremen?  (In  Factory,  v.  23,  pp.  63-67,  293-296, 
July-August,  1919.) 


CHAPTER  XIII 
TRAINING  THE  EMPLOYEE 

Productivity,  in  so  far  as  it  depends  on  human  factors,  depends 
upon  the  way  in  which  human  energy  is  applied  and  upon  the 
will  with  which  it  is  applied.  And  it  is  an  odd  commentary  upon 
the  fundamental  efficiency  of  industry  that  so  little  scientific 
attention  has  thus  far  been  given  to  the  work  of  putting  the  new 
employee  at  once  in  command  of  the  best  technique.  Proper 
training  methods  are  used  with  surprising  infrequency. 

Training  methods  which  show  the  way  in  which  human  energy 
can  be  applied  to  best  advantage  comprise  either  trade  training 
for  craftsmanship  or  specific  job  instruction  for  one  piece  of  work. 
Positive  influences  which  affect  the  will  to  work  are  reflected  in 
the  attitude  of  the  worker  which  has  largely  been  determined 
by  the  early  education  and  outlook  with  which  society  has 
equipped  the  boy  or  girl  starting  into  industry. 

For  administrative  purposes  the  training  problem  at  once 
divides  itself,  therefore,  into  these  two  major  parts:  The  problem 
of  training  young  people  who  are  entering  industry  for  the  first 
time;  and  the  more  specific  problem  of  training  those  who  are 
newly  entering  a  factory,  or  are  changing  their  position  within 
the  factory. 

The  training  of  those  who  are  to  enter  industry  along  lines  that 
will  help  them  to  advancement  and  happiness  in  their  work 
has  never  been  satisfactorily  solved.  Each  year  over  a  million 
young  men  and  women  find  their  way  into  the  industrial  world 
and  the  greater  number  of  them  have  no  preparation  for  their 
work  or  adequate  conception  of  what  their  work  will  mean. 
Reliable  figures  point  to  the  fact  that  ten  per  cent,  of  the  children 
in  this  country  leave  school  before  thirteen  years  of  age;  that 
forty  per  cent,  have  left  by  the  time  they  are  fourteen;  that 
seventy  per  cent,  have  left  by  the  time  they  are  fifteen  and 
eighty-five  per  cent,  by  the  time  they  are  sixteen.  "On  the 
average  the  schools  carry  their  pupils  as  far  as  the  fifth  grade 
but  in  some  cities  great  numbers  leave  below  that  grade."1 

1  Vocational  Education,  Report  of  the  Commission  on  National  Aid  to 
Vocational  Education,  1914,  v.  i,  p.  24. 

170 


TRAINING  THE  EMPLOYEE  171 

When  we  come  to  examine  in  detail  the  methods  by  which  new 
workers  are  inducted  into  their  work  in  factories  and  stores  we 
find  a  surprising  lack  of  system;  and  there  are  many  establish- 
ments where  no  formal  procedure  of  training  is  as  yet  instituted 
or  even  contemplated.  The  results  of  this  absence  of  training 
on  the  quantity  and  quality  of  production  and  in  terms  of  high 
labor  turnover  because  of  discouragement  due  to  the  worker's 
failing  to  make  good  at  the  process,  are  naturally  serious  and 
constitute  a  considerable  loss  to  industry. 

Methods  of  Training. — There  are  three  approaches  to  the 
problem  of  training  if  a  well  rounded  plan  is  to  be  adopted. 
There  is  the  work  that  the  public  schools  can  do;  there  is  the 
work  that  can  be  done  in  the  factory  by  the  corporation;  and 
there  is  the  work  that  can  be  done  by  the  cooperative  efforts  of 
industry  and  the  community. 

Although  our  attention  in  this  study  naturally  centers  upon 
the  factory  training,  it  is  important  for  the  manager  to  under- 
stand the  part  that  the  school  plays,  or  should  be  called  upon  to 
play,  in  the  initial  preparation  of  the  young  worker.  For  while 
there  can  be  no  absolute  line  of  demarcation,  it  is  increasingly 
recognized  that  the  school  has  a  primary  and  distinct  function 
in  relation  to  training.  It  must  train  for  citizenship ;  it  must  give 
the  background  for  a  well-rounded,  useful,  enjoyable  life.  But 
by  what  means?  By  general  cultural  courses  or  by  trade  training 
or  by  some  combination  of  both?  The  best  current  attitude  as 
to  the  respective  functions  of  public  school  and  of  factory  instruc- 
tion has  been  well  stated  in  the  following  words  of  a  group  of 
employers  in  a  western  city:  "Let  us  give  the  job  instruction; 
schools  must  perform  the  more  general  service  of  training  in  right 
thinking  and  character  building,  and  of  giving  the  scientific  and 
academic  foundation  for  specialization."1 

This  statement  emphasizes  in  an  adequate  way  the  general 
cultural  and  non-technical  aim  which  after  all  must  be  at  the 
basis  of  public  education. 

This  distinction  cannot  be  too  clearly  held  in  view.  For  em- 
ployers are  likely  to  be  tempted  to  urge,  as  did  the  employers 
of  another  city  in  the  course  of  an  educational  survey,  that 

1  Summarized  from  answers  to  questionnaires  sent  out  to  the  big  business 
concerns  of  St.  Louis.  Proceedings  of  the  Second  Pan  American  Scientific 
Congress,  Washington,  D.  C.,  Dec.,  1915-Jan.,  1916.  Part  I:  Education, 
p.  168. 


172  PERSONNEL  ADMINISTRATION 

the  greatest  need  is  "a  thorough  grounding  in  the  common  school 
branches  before  boys  and  girls  are  allowed  to  leave  school. 
The  need  of  more  thorough  work  in  English  and  arithmetic  is 
especially  emphasized.  Drawing  and  manual  training  of  a 
practical  kind  are  considered  important."  True  and  desirable 
as  all  this  may  be  from  the  industrial  point  of  view,  it  has  always 
to  be  remembered  that  life  is  more  than  livelihood,  that  educa- 
tion is  more  than  industrial  training,  that  education  for  life, 
liberty  and  the  pursuit  of  happiness,  is  presumably  an  inalienable 
birthright  of  American  children.  And  to  try  to  narrow  the 
public  educational  scheme  so  that  it  merely  passes  on  to  industry 
a  throng  of  submissive  machine  operators  would  result  in  a 
sorry  caricature  of  education. 

In  the  course  of  receiving  an  education  that  really  equips  them 
to  meet  the  problem  of  their  generation  there  is  every  advantage, 
however,  in  children's  receiving  supplementary  trade  training. 
Significant  experiments  in  this  direction  already  exist.  And 
they  serve  well  to  illustrate  the  possibilities  and  the  limits  of 
public  trade  education.  Under  present  school  age  laws,  trade 
schools  usually  take  children  from  14  to  16  years  of  age  and  give 
training  for  as  much  of  the  two  years  as  the  children  can  be  held. 

The  Manhattan  Trade  School  of  New  York  City  is  a  good 
example  of  this  type.  It  is  housed  in  a  large,  well  lighted  build- 
ing, and  the  instruction  rooms  are  fitted  up  to  reproduce,  in  so 
far  as  possible,  the  environment  of  a  sanitary  work  shop.  The 
articles  made  are  for  sale,  and  must  fulfil  trade  standards.  The 
course  of  study  is  planned  for  girls  who  wish  to  enter  some  line 
of  employment  as  soon  as  possible.  "  The  majority  of  these  girls 
cannot  spend  more  than  one  year  for  training  and  provision  is 
therefore  made  for  a  course  of  study  extending  over  one  year,  with 
the  opportunity  for  advanced  work  in  any  subject  if  the  girl  can 

remain  a  longer  time About  five  hours  each  day  or 

twenty-five  hours  per  week  are  devoted  to  trade  practice,  and 
the  remaining  time  to  related  subjects.  The  instruction  is 
individual,  and  the  girls  are  promoted  as  rapidly  as  their  work 
will  permit.  A  diploma  is  given  to  girls  who  complete  the  year's 
course  in  any  one  of  the  following  trades:  Dressmaking,  Millinery, 
Lamp  Shade  Making,  Clothing  Machine  Operating,  Embroidery 
Machine  Operating,  Straw  Machine  Operating,  Sample  Mounting, 
Novelty  Case  Making,  French  Edge  Making,  and  Cooking."1 

1  Announcement  of  the  Course  of  Study  of  the  Manhattan  Trade  School 
for  Oirla. 


TRAINING  THE  EMPLOYEE  173 

In  order  that  the  girl  may  become  an  all-round,  skilled  worker 
her  course  includes,  besides  practice  in  the  trade  which  she  elects 
to  learn,  lessons  in  Applied  Design,  Business  Arithmetic  and 
Accounts,  Business  English,  Textiles,  Industrial  Conditions  and 
Trade  Ethics,  Physical  Training  and  Personal  Hygiene.  The 
students  are  placed  in  good  positions  at  the  conclusion  of  the 
year,  and  their  progress  is  followed  for  some  time. 

This  school  accommodates,  however,  but  a  few  hundred  stu- 
dents out  of  the  several  hundred  thousand  who  are  in  the  public 
schools  of  New  York.  To  duplicate  this  equipment  to  meet  the 
needs  of  a  quarter  of  the  children  that  might  profit  by  such 
training  would  be  very  expensive;  to  determine  the  ability 
of  the  several  industries  of  New  York  to  absorb  the  new  workers 
would  be  essential  if  the  plan  were  extended;  to  prevent  the 
courses  from  degenerating  into  free  training  classes  for  factories 
into  whose  working  forces  the  children  would  be  rushed,  would  be 
imperative. 

Training  in  the  Factory. — In  short,  the  work  of  factory  training 
in  the  specific  content  of  jobs  is  not  the  business  of  the  city.  It  is 
the  business  of  industry,  and  should  to  a  preponderant  extent  be 
a  charge  on  industry.  It  is  this  business  of  training  for  factory 
work  which  we  shall  next  consider.  Corporation  training  as  now 
developed  may  be  considered  in  three  aspects:  Specific  job  in- 
struction ;  training  for  trade  mastery  and  craftsmanship ;  general 
education  which  supplies  the  background  missed  because  of  in- 
sufficient schooling. 

Job  Instruction. — The  work  of  defining  and  delimiting  the  field 
when  discussing  the  training  of  employees  is  difficult  because  of 
the  looseness  with  which  the  terms  are  now  used.  The  "  corpora- 
tion school, "  for  example,  may  be  used  to  characterize  all  educa- 
tional activities  maintained  by  a  concern.  But  in  what  respects 
it  differs  from  a  "vestibule  school"  it  is  not  always  easy  to 
discover.  In  general,  however,  the  term,  corporation  school, 
is  used  more  inclusively  of  all  company  training  procedure. 
And  the  term,  "vestibule  school,"  applies  to  the  introductory 
training  carried  on  either  apart  from  or  in  the  workroom.  "It 
is  a  preliminary  training  school  in  which  to  observe  and  coach 
new  employees.  The  vestibule  school  is  to  the  industrial  organi- 
zation what  the  vestibule  is  to  the  home.  In  the  home  it  is  a 
place  where  the  entrant  stops,  wipes  his  shoes  on  the  mat,  adjusts 
his  garments,  and  performs  those  duties  which  prepare  him  to 


174  PERSONNEL  ADMINISTRATION 

enter  the  house  proper.  In  the  factory  it  is  a  place  which  detains 
the  incoming  employee  until  he  has  become  adjusted  to  a  new 
environment  and  has  been  prepared  to  handle  the  essential  ele- 
ments of  his  prospective  work."1 

The  conditions  under  which  training  work  may  be  carried  on 
are,  of  course,  as  varied  as  the  kinds  of  work  and  of  industries 
which  might  be  considered.  Yet  if  we  confine  ourselves  for  the 
present  to  the  instruction  of  the  new  worker  in  order  that  he  may 
do  his  own  job  well,  there  are  a  few  general  observations  which 
can  be  safely  made  and  a  few  common  problems  which  can  be 
stated. 

General  Methods  of  Procedure. — Whether  training  should 
be  in  a  separate  schoolroom  or  workroom  or  in  one  coiner  of  the 
actual  work  shop,  will  depend  upon  the  nature  of  the  work. 
There  are,  however,  at  many  jobs  which  are  not  craftsmen's  work, 
important  values  in  having  the  place  of  training  adjoin  the  work- 
room. A  "production  atmosphere"  is  thus  felt  from  the  start; 
there  is  the  stimulus  of  seeing  the  fully  equipped  workers  at 
their  places  and  of  knowing  that  in  a  few  days  or  weeks  the  learner 
will  be  transferred  out  of  the  training  section;  there  is  the  in- 
centive to  learn  quickly  which  the  normal  pace  of  the  trained 
worker  arouses  in  the  beginner. 

There  should,  of  course,  for  all  training  work  be  special  in- 
structors, specially  trained.  But  whether  they  should  be  workers 
picked  because  of  trade  skill  and  ability  to  teach  or  be  trained 
teachers  who  familiarize  themselves  with  the  work,  it  is  impossible 
definitely  to  say.  Both  methods  are  in  successful  use  in  different 
industries. 

The  training  should  in  any  case  be  carefully  thought  out  from  a 
pedagogical  standpoint.  The  sequential  order  of  an  operation 
is  not  necessarily  the  best  order  in  which  to  teach  it.  The  teacher 
must  reduce  the  job  to  its  elements  and  start  the  learner  in  on 
its  simplest  parts,  building  from  the  work  he  can  naturally  do 
easily  to  the  more  complicated  operations. 

The  training  should  be  individualized  as  far  as  possible.  One 
instructor  to  not  more  than  every  eight  or  ten  workers  gives  the 
best  results  at  most  kinds  of  work. 

Workers  in  training  should  usually  work  on  materials  that  are 
going  into  the  actual  production.  This  holds  them  up  to  a 

1  LINK,  H.  C.     Employment  Psychology,  p.  273. 


TRAINING  THE  EMPLOYEE  175 

quality  standard  from  the  start;  and  increases  their  interest  in 
what  they  are  doing. 

There  should  be  a  maximum  time  limit  in  which  the  training 
must  be  finished.  If  after  that  time  the  employee  does  not 
produce  what  the  average  new  worker  is  expected  to,  his  case 
should  receive  individual  attention  from  the  training  director  to 
see  if  transfer  to  some  other  position  is  desirable. 

Learners  should  of  course  be  paid  while  learning;  and  they 
must  be  paid  enough  to  induce  them  to  stay  through  the  dis- 
couraging learning  period.  Many  firms  make  the  mistake  of 
giving  such  nominal  wages  during  the  weeks  of  training  that 
the  turnover  in  this  period  is  excessive.  Training  is  at  best  a 
speculative  investment  for  a  firm;  but  the  risks  of  losing  the 
trained  worker  are  reduced  if  the  importance  of  the  investment 
is  seen  sufficiently  to  pay  the  price  at  the  initial  stages. 

Wherever  practical,  learners  should  be  taught  several  opera- 
tions either  at  the  start  or  during  the  first  few  months  of  employ- 
ment. Ordinarily,  if  the  idea  can  be  established  in  the  worker's 
mind  from  the  outset,  that  versatility  will  pay  both  him  and  the 
company,  far  less  difficulty  than  now  arises  will  be  met  at  a  later 
date  in  attempting  to  transfer  him. 

Instructors  should  be  allowed  to  follow  up  workers  for  the  first 
few  days  after  they  have  gone  into  the  production  departments; 
in  this  way  they  are  assured  a  more  completely  satisfactory 
start. 

Cost  of  Training. — The  cost  of  training  work  is  undoubtedly 
high,  although  whether  or  not  the  net  expense  is  greater  than 
when  employees  simply  "pick  up"  what  they  know,  and  spoil 
materials  and  put  machinery  out  of  repair  in  the  process,  is 
doubtful.  For  job  instruction  in  its  narrowest  meaning  pays  in 
obvious  returns  of  better  work  and  in  workers  turning  out 
normal  amount  of  production  far  sooner  than  otherwise.  The 
time  taken  to  learn  an  operation  under  formal  training  may  be 
a  half  to  a  third  of  the  time  required  to  "pick  it  up." 

It  is  rather  when  a  more  elaborate  educational  procedure  of 
trade  and  craft  training  or  of  general  education  is  pursued  that  the 
cost  becomes  a  considerable  factor.  Of  these  types  of  training 
the  following  statement  has  been  made:  "Of  approximately  300,- 
000  commercial  and  industrial  undertakings  in  the  country, 


176  PERSONNEL  ADMINISTRATION 

about  600  only  appear  to  have  the  financial  resources  necessary 
to  provide  even  elementary  educational  facilities  for  their  em- 
ployees."1 Although  this  statement  probably  understates  the 
ability  of  each  factory  to  pay,  it  does  point  to  the  need  of  co- 
operative efforts  and  cooperative  support. 

A  group  of  neighboring  factories  in  the  same  industry,  for 
example,  could  cooperate  in  the  hiring  of  teachers  and  the 
provision  of  equipment.  Joint  efforts  of  employers  and  public 
educational  institutions  in  dividing  the  cost  of  teachers  and 
overhead  are  also  being  found  feasible. 

"In  some  cases,"  says  a  recent  report,  "several  establishments 
have  cooperated  in  the  inauguration  of  training  schools.  Such  an  in- 
dustrial school  has  been  established  in  Dayton,  Ohio,  by  four  large 
firms.  Both  day  and  evening  courses,  open  to  women  as  well  as 
men,  are  offered  in  the  operation  of  the  lathe,  shaper,  drill  press, 
hand  screw  machine,  grinder,  tapping  machine,  turret  lathe,  punch 
press,  automatic  screw  machine,  hand  and  power  milling  machines, 
and  the  profile  machine,  as  well  as  in  tool  making  and  mechanical 
drawing.  The  instructors  are  successful  journeymen  with  a  thorough 
knowledge  of  their  trade,  who  understand  actual  shop  conditions  and 
commercial  requirements  and  who  have  an  aptitude  for  teaching. 
In  this  school  a  charge  is  made  for  instruction,  whereas  in  factory  train- 
ing it  is  usual  to  pay  a  nominal  wage  to  employees  while  learning. 
The  certificate  granted  at  the  close  of  the  course,  however,  practically 
guarantees  employment  to  its  recipient. 

"Another  idea  which  has  several  times  been  applied  with  advantage 
is  the  use  of  a  factory  that  is  working  only  day  shifts  as  an  evening 
school  for  training  new  employees.  Instructors  are  secured  from  among 
properly  qualified  foremen  of  the  establishment."* 

Examples  of  Training  Procedure. — Each  industry,  we  appre- 
ciate, faces  special  training  problems.  And  beyond  what  has 
already  been  said,  brief  statements  regarding  several  actual 
procedures  may,  therefore,  be  the  most  helpful  way  of  indicating 
possible  methods.  The  educational  course  of  the  Packard 
Automobile  Company  is  an  interesting  example  of  the  working 
plans  of  a  vestibule  school.  Four  courses  are  carried  on;  one 
for  men,  one  for  women,  another  for  instructors,  and  still  another 
for  job  setters  and  foremen.  The  average  time  required  to 

1  Proceedings  of  the  Second  Pan  American  Scientific  Congress,  p.  149. 
f  National  Industrial  Conference  lioard,  Wartime  Employment  of  Women 
in  the  Metal  Trades.     Research  report,  No.  8,  July,  1918,  pp.  46-47. 


TRAINING  THE  EMPLOYEE  177 

complete  the  special  training  is  ten  days,  though  some  take  less 
time,  and  others,  as  in  the  case  of  the  welder,  take  more.  Sixteen 
days  is  the  highest.  Whenever  possible  the  employee  is  per- 
mitted to  elect  the  type  of  work  which  he  or  she  wishes  to  learn, 
although  the  management  may  have  to  guide  proceedings  some- 
what if  the  employee  chooses  something  for  which  he  is  clearly 
not  adapted  mentally  or  physically. 

Courses  of  instruction  are  offered  in  a  long  list  of  mechanical 
operations;  lathes,  hand  screw  machines,  milling  machines,  gear 
cutters,  hand  milling  machines,  many  kinds  of  grinders,  welding, 
inspection,  testing,  and  figuring  premiums.  A  complete  record 
of  each  student  is  kept,  not  only  of  progress  in  the  school  but  of 
the  subsequent  work  in  the  shop.  The  cost  of  the  course  averages 
about  fifty  dollars  per  student.1 

Some  of  the  conclusions  reached  by  this  company,  formed  as  a 
result  of  the  courses,  are  worth  quoting.  "It  has  been  proven 
beyond  a  shade  of  doubt  that  a  more  successful  body  of  workers 
can  be  obtained  through  preliminary  training  than  without 
its  aid.  This  training  can  be  given  at  less  cost,  to  better  ad- 
vantage, and  with  less  interference  with  production  at  a  point 
removed  from  productive  activities."  "It  should  be  realized  that 
in  the  training  course,  the  worker  must  not  only  be  trained  to  do 
the  job  correctly,  but  must  also  be  trained  physically  to  do  the 
job  easily."  "In  dealing  with  large  numbers  of  employees  who 
have  little  or  no  conception  of  the  job  in  hand,  we  have  noticed  a 
strong  tendency  toward  lack  of  direction  in  the  efforts  of  the 
students,  and  it  has  been  found  that  success  can  only  come 
as  a  result  of  strict  discipline — you  must  give  practically  in- 
dividual attention  to  each  student.  Consequently,  the  instruct- 
ing force  should  not  be  overburdened.  We  have  found  that  on 
elementary  work  the  instructor  can  take  care  of  five  students, 
while  on  machine  work  one  to  three  is  the  outside  ratio  and  one 
to  two  gives  the  best  results."1 

One  of  the  most  thorough-going  of  recent  experiments  in  job 
instruction  courses  was  that  carried  on  by  the  United  States 
Shipping  Board  in  the  training  of  shipyard  workers.  A  summary 
of  the  work,  with  its  purposes  and  findings  has  been  published, 
and  the  brief  outline  at  the  beginning  of  the  report  gives  an 
excellent  idea  of  the  methods  and  results. 

1  STANBROUGH,    D.     G.     Packard    Training    School    for    Employees, 
Industrial  Management,  November,  1918,  p.  380o 
12 


178  PERSONNEL  ADMINISTRATION 

The   Plan   for  Shipyard  Training  Laid  out  by  the  Emergency  Fleet 
Corporation 

1.  "All  training  of  shipyard  workers  was  to  be  done  by  the  ship- 
builders. 

2.  "Instructors  were  to  be  selected  by  the  shipbuilders  and  assigned 
for  the  training  of  workers  in  the  yards. 

3.  "These   instructors   were  to   be  specially    trained   in  the    best 
methods  of  giving  instruction. 

4.  "Special  instructor  training  for  shipyard  mechanics  was  to  be 
conducted  by  the  Emergency  Fleet  Corporation. 

5.  "The  Emergency  Fleet  Corporation  was  to  maintain  a  staff  of 
training  experts  to  help  the  shipyards  in  their  training  activities."1 

The  training  of  the  instructors  lasted  for  a  period  of  six  weeks. 
The  men  were  very  carefully  selected  for  the  course.     The  de- 
partment in  charge  of  the  training  was  quite  definite  concerning 
the  essential  qualifications.     It  requested  that  the 
Prospective  Instructor 

1.  "Should  have  had  not  less  than  five  years'  experience  in  the 
occupation  he  is  expected  to  teach. 

2.  "Should  have  had  the  equivalent  of  a  grammar  school  education. 

3.  "  Must  be  of  recognized  ability  in  the  trade  he  is  to  teach,  and  show 
at  least  some  of  the  following  traits: 

Patience. 

Dependability. 

Regularity. 

Ability  to  talk  clearly  and  intelligently  about  his  work. 

4.  "Preference  will  be  given  to  men  who  have  had  charge  of  workers. 

5.  "Preference  will  be  given  to  men  between  25  and  40  years  of  age. 
"In  addition  to  the  qualifications  noted  above,  prospective  directors 

should  have  the  following: 

1.  "  Must  have  had  experience  in  charge  of  men  and  should  have  made 
good  as  foreman  or  leading  hand. 

2.  "Preference  will  also  be  shown  for  men  who  have  secured  some 
supplementary  technical  education  by  taking  advantage  of  evening 
school  courses,  correspondence  courses,  etc."' 

The  Scope  of  the  Training  Work  Conducted  by  the  Emergency  Fleet 
Corporation 

1.  "The  first  training  center  was  opened  on  November  15,  1917. 

1  The  Training  of  Shipyard  Workers.  Report  of  the  Work  of  the  U.  8. 
Shipping  Board,  Emergency  Fleet  Corporation,  1919,  p.  11. 

1  From  a  typewritten  announcement  (No.  448)  of  the  Program  of  the 
Industrial  Training  Department,  Emergency  Fleet  Corporation,  for  Emer- 
gency Training  in  Shipyards. 


TRAINING  THE  EMPLOYEE  179 

2.  "Thirty-six  centers  were  opened  during  the  year  November  15, 
1917-November  15,  1918. 

3.  "One  thousand  and  ninety-eight  skilled  shipyard  mechanics  were 
trained  as  instructors. 

4.  "The  Education  and  Training  Section  was  responsible  for  the 
actual  training  of  80,000  men  through  the  efforts  of  trained  instructors. 
Results  Following  the  Installation  of  Intensive  Methods  of  Training 

1.  "The  number  of  yards  for  which  instructors  were  trained  totaled 
seventy-one. 

2.  "Instructor  training  was  given  to  men  of  30  different  shipyard 
trades. 

3.  "Average  number  of  men  trained  per  instructor  per  month  is 
8.55  men. 

4.  "The  average  length  of  training  period  studied  in  21  yards  for  20 
trades  and  from  the  records  of  9677  men  was  found  to  be  19.27  days. 

5.  "The  tonnage  produced  by  the  men  trained  by  the  intensive 
methods  of  the  Emergency  Fleet  Corporation  totaled  498,780  tons  or 
equivalent  to  62  ships  of  8000  dead  weight  tons  capacity. 

The  Factors  which  Made  for  Effective  Training 

1.  "The  instructors  who  were  trained  were  found  to  have  had  an 
average  trade  experience  of  10.6  years. 

2.  "In  all  the  yards  studied,  the  training  was  done  on  ship  material, 
in  the  shops  or  on  the  ways,  no  practice  work  being  done. 

3.  "Segregating  the  learners  on  a  'school  ship'  was  found  to  increase 
the  average  training  period  for  five  trades  in  several  yards  from  25.98 
days  to  44.62  days  and  to  reduce  the  number  of  learners  per  instructor 
from  8.09  per  month  to  6.26  per  month. 

4.  "For  the  yards  studied,  the  size  of  the  groups  of  learners  under 
one  instructor  varied  from  an  average  of  7.3  men  in  one  yard  to  16.5 
men  in  another.     The  two  yards  that  produced  the  men  with  the  highest 
capabilities  averaged  11.1  and  9.3  men  in  a  group  respectively. 

5.  "The  giving  of  instruction  in  proper  sequence  was  of  considerable 
importance  in  developing  effective  training. 

"Alternating  half  day  sessions  for  instructor  training  was  not  as 
effective  as  full  day  training."1 

The  Cost  of  Training  Men 

1.  "The  average  actual  cost of  training  riveters  in  eight 

yards  was  found  to  be  $24.34  per  learner  trained."1 

The  shipyard  experience  illustrates  many  of  the  most  important 
points  to  be  borne  in  mind  in  the  organizing  of  a  course  of  special 
training  for  employees.  It  emphasizes  the  need  for  the  careful 
selection  and  training  of  teachers,  and  the  qualities  that  make  the 

1  The  Training  of  Shipyard  Workers,  pp.  11,  12,  13. 


180  PERSONNEL  ADMINISTRATION 

successful  instructor;  it  shows  the  rapidity  with  which  effective 
educational  schemes  may  be  developed;  and  it  indicates  the 
value  of  small  classes.  Most  interesting  of  all,  however,  is  the 
suggestion  that  it  gives  for  cooperation  between  factories  and 
plants  in  other  lines  of  work.  It  points  the  way  for  companies 
which  feel  that  they  cannot  support  training  courses  alone,  but 
could  perhaps  join  with  others  in  an  educational  program. 

"Conversion  training"  is  another  type  of  instruction  on  the 
job,  used  by  the  shipbuilding  industry  during  the  war.  It  takes 
advantage  of  a  man's  previously  obtained  skill  in  one  trade  and 
prepares  him  for  an  allied  trade.  It  recognizes  that  kindred 
trades  may  require  such  similar  types  of  skill  that  after  a  brief 
conversion  training,  the  trained  worker  may  be  equipped  to 
work  at  several  related  trades.  For  example,  men  who  have 
been  employed  in  building  bridges,  tanks,  and  boilers  can  be 
used  in  erecting,  bolting,  drilling  and  riveting  ships.  Such 
satisfactory  results  were  obtained  by  this  kind  of  training  that 
the  idea  is  now  being  extended  into  other  industries. 

Training  for  Trade  Mastery. — -Training  for  trade  mastery  and 
for  craftsmanship  has  almost  been  driven  out  of  existence  by  the 
specialized  machine.  Formerly  a  man  entered  a  trade  and  made 
it  his  life  work.  Today,  occupations  have  been  so  divided  that  a 
new  type  of  training  is  necessary  to  meet  the  new  demand — a 
training  which  gives  knowledge  of  the  mass  of  modern  scientific 
facts  and  familiarity  with  the  complicated  mechanism  of  the 
machine.  Instruction  for  trade  mastery  within  the  shop  is  thus 
much  broader  than  training  for  the  job  alone.  It  is  the  second 
of  the  suggested  classifications  under  which  existing  corporation 
schools  may  be  grouped. 

"Trade  knowledge,  such  as  that  possessed  by  nil-round,  adaptable 
workmen,  consists  in  the  principles  underlying  the  various  processes 
adopted  to  the  trade;  the  names,  descriptions,  uses  and  construction  of 
tools  and  appliances  used;  the  method  of  rending  drawings  and  diagrams; 
the  origin,  properties,  and  uses  of  the  various  materials  selected;  ele- 
mentary ideas  on  the  cost  of  the  product;  the  importance  of  avoiding 
waste  of  material,  time,  and  effort;  the  functions  of  the  apparatus  and 
the  parts  thereof  which  he  assists  to  manufacture."1 

"This  newer  kind  of  instruction  for  potential  craftsmen  should  pref- 
erably he  given  in  a  school  attached  to  the  works  undertaking  the 
training  of  apprentices. 

1  GARVEY,  J.  J.  Modern  Apprenticeship,  N.A.C.S.,  Sixth  Annual  Report, 
July,  1918,  p.  134. 


TRAINING  THE  EMPLOYEE  181 

"There  is  no  reason  why  even  small  works  should  not  provide  such 
educational  facilities,  although  the  concentration  of  industries  in  definite 
areas  undoubtedly  facilitates  the  development  of  a  school  serving  a 
number  of  firms  on  a  cooperative  basis."1 

"In  a  large  number  of  works  (in  the  U.  S.),  schools  have  been  pro- 
vided for  the  education  of  apprentices,  and  in  many  cases  training  work- 
shops have  been  added,  although  opinion  is  divided  as  to  the  merits  of 
the  ordinary  works  or  the  special  shop  in  training  apprentices.  Such 
schools  have  been  established  at  the  Pennsylvania,  Santa  Fe*  and  other 
large  railway  companies,  the  Westinghouse  Electric  and  Manufacturing 
Company,  the  General  Electric,  Yale  &  Towne,  Browne  &  Sharpe, 
International  Harvester,  Packard,  Cadillac  and  other  large  works. 
Instruction  is  given  in  a  class  room  for  a  few  hours  each  week,  and  prac- 
tical training  is  arranged  under  the  supervision  of  an  instructor  or  fore- 
man. In  those  cases  where  a  special  training  shop  is  provided,  an 
apprentice  often  spends  six  months  in  this  and  then  six  months  in  the 
main  shop,  where  his  new  knowledge  is  applied  under  commercial 
conditions;  he  subsequently  returns  to  the  apprentice  shop,  and  learns 
another  process  or  tool  operation,  and  so  on  to  the  end  of  his  apprentice- 
ship. In  the  General  Electric  Company,  the  whole  period  of  apprentice- 
ship is  spent  in  the  classroom  or  training  shop,  and  in  the  latter  he  is 
judged  to  have  attained  sufficient  proficiency  to  proceed  to  new  work 
if  he  can  teach  the  boy  who  follows  him  the  process  to  be  mastered.  A 
four  year  apprenticeship  is  becoming  common  in  the  United  States."2 

"Today  no  contract  at  all  is  preferable  to  the  legal  indenture  in  many 
industries. 

"A  verbal  agreement  between  an  employer  and  a  youth  that  the  latter 
shall  come  to  the  works  and  learn  a  trade  while  in  receipt  of  a  definite 
wage  is  beneficial  in  stimulating  an  apprentice  continually  to  satisfy 
an  employer  by  good  work,  which  is  obviously  good  for  the  apprentice 
himself,  since  if  he  is  unsatisfactory  he  can  be  discharged.  On  the  other 
hand,  an  employer  will  always  endeavour  to  keep  a  good  apprentice, 
and  will  invariably  afford  him  facilities  for  obtaining  a  good  trade  knowl- 
edge since  he  has  the  option  of  leaving  at  any  time  if  conditions  become 
less  tolerable  than  those  obtaining  elsewhere.'''3 

The  writers  of  the  above  paragraphs  recognize,  however,  a 
number  of  difficulties  in  this  new  development  of  apprentice- 
ship. They  find  that  the  courses  are  not  sufficiently  organized; 
that  there  is  need  of  standards  as  to  what  constitutes  a  skilled 
worker;  that  boys  may  often  be  in  danger  of  being  exploited  at 

1  FLEMING,   A.    P.    M.   and   PEABCE,   J.   G.,    1916.     The   Principles  of 
Apprentice  Training,  p.  64. 

2  Op.  tit.,  p.  102. 

3  Op.  cit.,  pp.  118-119. 


182  PERSONNEL  ADMINISTRATION 

repetitious  work;  that  more  boys  are  required  for  actual  produc- 
tion purposes  than  are  provided  with  training  opportunities; 
and  that  determination  of  the  relative  jurisdiction  of  educators 
and  foremen  is  difficult. 

Another  writer1  offers  the  helpful  suggestion  that  any  firm, 
employing  skilled  mechanics,  that  can  absorb  ten  new  employees 
a  year  in  his  organization  should  have  a  factory  school. 

"Shops  that  cannot  absorb  more  than  ten  new  men  a  year  would 
have  to  either  train  their  apprentices  in  the  shop  itself — perhaps 
under  the  supervision  of  some  workman  who  is  given  some  time 
and  credit  for  this  supervision — or  through  a  cooperative  school 
organized  by  several  smaller  shops.  The  disadvantage  of  the 
cooperative  school  is  the  fact  that  the  boy  is  not  constantly  under 
the  control  of  the  factory  discipline,  with  the  attendant  results 
of  less  enthusiasm  and  less  loyalty." 

Special  Training  Courses. — In  place  of  the  apprenticeship 
system,  some  firms  are  building  up  what  may  be  called  special 
training  courses.  They  provide  for  both  the  new  employee  and 
the  man  already  on  the  job;  and  generally  cover  a  wide  range  of 
cultural  as  well  as  practical  matter.  For  example,  a  large  elec- 
trical firm  has  a  compulsory  course  given  through  a  period  of  two 
years — several  hours  a  week — on  company  time,  which  includes 
the  history  and  development  of  electricity,  effective  speaking, 
business  letter  writing,  individual  efficiency,  hygiene  and  health, 
company  organization,  and  the  elements  of  psychology  and 
salesmanship. 

The  objects  of  such  special  training  may  be: 

"(a)  To  train  new  employees  in  performing  certain  duties  to  which 
they  have  been  assigned; 

"(6)  To  prepare  old  employees  in  the  handling  of  more  complicated 
work;  or 

"(c)  To  train  all  employees  in  matters  of  general  information." 

Other  Methods  of  Instruction  Within  the  Factory. — When 
concentrated  courses  are  not  possible,  there  are  many  other 
methods  of  educating  the  worker  available — conferences,  lec- 
tures, organized  reading  in  the  library,  inspection  trips,  and 
suggestion  systems. 

The  conference  is  being  widely  used  in  training  the  sales  force 
of  large  department  stores,  and  the  buyers'  conference  offers  one 

1  GARVEY,  J.  J.  Modern  Apprenticeship,  N.A.C.S.,  Sixth  Annual  Report, 
July,  1918,  pp.  351-301. 

«N.  A.  C.  S.,  Annual  Report,  191S,  p.  100. 


TRAINING  THE  EMPLOYEE  183 

of  the  simplest  forms  of  instruction.  The  buyer  is  the  principal 
officer,  and  a  weekly  meeting  at  which  he  lectures  and  answers 
questions,  has  real  educational  value.  Shop  committee  work, 
as  we  shall  subsequently  see,  has  its  great  value  as  an  educational 
medium. 

Lectures. — Lectures  in  the  more  formal  sense  are  also  worth- 
while. Some  firms  provide  halls  in  which  the  entire  works 
force  may  be  assembled  for  talks  by  buyers  on  raw  materials 
and  markets;  by  salesmen  on  the  disposal  of  goods;  by  experts 
on  technical  and  scientific  processes;  and  by  executives  on  or- 
ganization policies  and  practices.  Motion  pictures  and  lantern 
slides  may  be  used.  The  man  who  has  seen  the  operation  of  the 
factory  devices  or  the  making  of  the  company  product  pictured 
on  the  screen  does  not  readily  forget  it. 

Works  Libraries. — The  company  which  has  a  works  library 
and  can  arrange  for  its  systematic  use,  has  still  another  educa- 
tional force  at  its  disposal.  The  first  element  in  the  success 
of  the  works  library  is  the  librarian.  If  he  is  skilled  in  the  han- 
dling of  industrial  subjects,  and  understands  the  psychology  of  the 
men  about  him  well  enough  to  select  for  them  just  the  book  or  the 
magazine  article  that  they  need,  he  may  become  the  center  of 
a  definite  educational  program. 

The  library  should  contain  books  of  a  technical  nature  which 
will  be  useful  in  the  plant ;  books  which  tell  of  health  and  safety 
and  the  problems  of  management  and  shop  control,  in  addition 
to  the  more  general  cultural,  literary  and  purely  diverting  books. 
In  cooperation  with  the  public  library  of  the  neighborhood,  the 
shop  library  can  supply  many  volumes  to  fill  the  temporary  needs 
of  employees  which  it  could  not  otherwise  afford  to  provide. 

Educational  Trips.— Several  plants  find  that  the  inspection 
trip  both  within  the  factory  and  to  other  shops  and  museums 
is  an  important  method  of  training.  It  at  least  gives  that 
broad  view  of  the  business  as  a  whole  which  is  extremely  necessary. 
One  company  trained  twenty-five  of  its  men  from  the  engineering, 
finance,  and  sales  departments  as  guides  and  with  their  aid 
routed  the  entire  working  force  of  thirty-five  hundred  employees 
through  the  plant.  The  groups  were  small,  and  were  each 
guided  for  three  hours.  It  took  two  months  to  give  all  the  em- 
ployees a  personally  conducted  tour,  but  when  the  work  was 
completed  it  had  proved  so  stimulating  that  the  company 
decided  to  extend  the  privilege  to  the  families  and  friends  of  the 
laborers.  About  twenty-five  thousand  more  people  were  ac- 


184  PERSONNEL  ADMINISTRATION 

cordingly  taken  through,  and  the  intelligent  interest  that  was 
aroused  by  the  whole  affair  more  than  justified  the  trouble. 
In  addition,  instead  of  retarding  the  processes  of  production 
it  stimulated  them,  for  during  the  period  when  the  trips  were 
being  made  the  output  was  five  per  cent,  above  normal. 

Other  training  methods  may  include  the  use  of  exhibits  of  the 
product  from  the  stage  of  raw  material  to  its  reception  by  the 
consumer. 

Suggestion  systems  will  have  considerable  educational  value  if 
administered  in  such  a  way  that  they  hold  interest  and  invite 
ideas. 

Correspondence  courses,  despite  their  limitations,  may  be 
helpful  for  individuals  or  for  groups  who  will  cooperate  in  follow- 
ing through  a  course  together. 

Training  the  Disabled  in  Industry. — There  is  also  the  problem 
of  training  the  man  who  has  been  injured  in  his  day's  work — 
the  man  who  has  lost  an  arm,  a  foot,  or  an  eye.  Each  year 
there  are  fourteen  thousand  accidents  which  result  in  disablement 
and  the  average  age  of  these  injured  wage  earners  is  only  between 
thirty  and  thirty-three  years.  Yet  at  present,  although  there 
are  in  this  country  not  less  than  500,000  men  and  women  of 
working  age  idle  because  of  disability,  little  effort  either  public 
or  private  is  being  made  to  re-train  them. 

The  Federal  Board  for  Vocational  Education  has  undertaken 
the  task  of  ro-oducating  the  disabled  soldier;  it  aims  to  sec  to  it 
that  the  wounded  man  is  prepared  for  a  new  job,  in  which  his 
health  will  be  cared  for,  and  his  special  abilities  capitalized. 
Courses  are  given  in  the  mechanical  and  manufacturing  processes, 
in  poultry  raising,  horticulture,  forestry,  cattle  raising  and  civil 
engineering.  Each  man  represents  an  individual  problem  and 
is  given  individual  treatment. 

It  is  equally  practical  and  desirable  to  extend  this  procedure 
into  industry.  Indeed  we  are  assured  by  experts  that,  "in  our 
highly  specialized  modern  industrial  life  with  its  minute  division 
of  employment  and  tasks,  it  is  possible  therefore  for  practically 
every  handicapped  man  under  an  intelligent  program  of  voca- 
tional rehabilitation  to  discharge  acceptably  some  task  as  a  full 
substitute  for  a  normal  man.  In  each  individual  case  the  prob- 
lem is  simply  one  of  selecting  the  right  employment  and  training 
for  it."1 

1  HATUUS.  GAUBARD.    The  Redemption  of  the  Disabled.  1019,  p.  208. 


TRAINING  THE  EMPLOYEE  185 

General  Educational  Work. — The  third  type  of  educational 
work  in  industry  aims  to  make  good  deficiencies  in  the  workers' 
schooling.  Instruction  in  English  is  of  major  importance  in  this 
group.  Although  frequently  undertaken  as  a  factory  respon- 
sibility this  instruction  is  really  a  public  function,  and  as  a 
practical  procedure,  factories  and  schools  should  probably  co- 
operate in  giving  it  more  than  is  now  the  case. 

The  Massachusetts  Board  of  Education,  for  instance,  suggests 
several  feasible  plans  in  which  school  and  industry  may  combine 
in  Americanizing  foreign  workers.  These  plans  include  one  to 
conduct  the  school  on  company  time  within  the  works,  with 
public  school  teachers;  another  to  hold  school  outside  the  works 
partly  or  wholly  on  factory  time,  with  public  school  teachers; 
and  still  others  to  establish  a  school  within  the  works  on  company 
time,  taught  by  factory  employees  or  volunteer  teachers;  to 
conduct  a  school  outside  the  works  partly  or  wholly  on  company 
time,  with  factory  employee  or  outside  teachers;  and  finally  to 
have  school  outside  the  works  on  employee  time,  taught  by  ap- 
proved instructors  and  all  expenses  paid  by  other  agencies. 

Many  companies  realizing  the  industrial  advantage  of  the 
Americanization  movement,  are  now  cooperating  in  one  of  these 
various  ways  with  public  schools  and  educational  agencies  in 
giving  courses  in  English  and  naturalization  to  their  foreign 
employees.  Experience  seems  to  show  that  the  best  results  are 
obtained  in  schools  held  on  company  time  (or  before  6  P.M.); 
in  small  classes  of  one  sex  which  have  teachers  who  know  the 
native  language  of  the  workers;  in  classes  which  meet  at  least 
three  times  a  week  (every  day  is  better);  and  in  classes  where 
the  same  degree  of  previous  schooling  prevails  among  all  members. 

English  instruction  is  of  course  only  one  narrow  aim  of  these 
general  educational  courses.  Civics  classes  for  those  who  are 
anxious  to  become  citizens  are  also  provided.  In  some  large 
corporations  the  scope  of  the  training  becomes  so  broad  as  to 
be  in  effect  a  whole  scheme  of  university  extension  courses. 

Continuation  Schools. — It  remains  to  consider  only  the  pres- 
ent developments  of  training  in  which  industry  and  the  public 
schools  cooperate.  Public  schools  which  take  children  from  14 
to  16  years  of  age  during  part  of  the  time  while  the  factory  takes 
them  during  the  rest  of  the  working  hours,  are  called  continuation 
schools.  In  some  cases  the  children  leave  industry  for  eight  or 
ten  hours  a  week  for  class  work  in  the  school.  And  under 


186  PERSONNEL  ADMINISTRATION 

another  arrangement  they  alternate  one  week  in  the  school 
with  one  week  in  the  factory. 

The  possibilities  of  such  reciprocal  relation  between  school  and 
industry  are  great,  especially  if  the  proper  joint  administrative 
machinery  is  instituted.  Control  of  the  selection  of  courses 
and  of  their  content  cannot  wisely  be  left  to  any  one  group. 
There  should  be  joint  action  of  employers,  organized  workers 
and  educators  on  all  problems  of  industrial  education,  and  ex- 
pense can  on  this  basis  be  wisely  shared  between  industry  and 
community. 

There  seems  to  be  wider  and  wider  consensus  of  opinion  that 
it  is  in  this  direction  of  joint  supervision  and  joint  support  that 
progress  in  industrial  training  can  come.  The  limited  task  of 
job  instruction  is  only  one  aspect  of  the  problem.  The  work  of 
more  general  equipment,  the  work  of  broadening  and  deepening 
the  understanding  and  capacities  of  all  children  from  14  to  18 
years,  is  the  more  basic  task.  And  to  undertake  it  in  any  ade- 
quate fashion  requires  a  cooperative  effort  as  yet  hardly  imag- 
ined.1 The  difficulty  is  not  merely  that  managers  have  failed 

1  The  plan  outlined  below  for  Sweden  is  the  sort  of  procedure  that  begins 
to  cope  with  the  problem: 

"Sweden,  of  course,  like  many  other  nations,  is  feeling  the  lack  of 
really  skilled  workmen,  and  is  beginning  k>  recognize,  further,  thut  the 
really  skilled  workman,  unless  he  is  at  the  same  time  a  well-educated 
workman,  is  not  the  valuable  industrial  asset  he  might  be.  And 
so  the  plan  proposed  to  the  Municipal  Council  of  Stockholm  by  the 
Board  of  Industrial  Schools  provides,  at  every  stage,  for  the  general 
education  of  the  apprentice,  side  by  side  with  his  technical  education. 
Indeed,  the  work  of  general  education  has  a  very  prominent  place  in  the 
scheme  right  up  to  the  time  when,  as  a  young  man  of  nineteen,  the 
upprentice  emerges  from  his  last  course  of  instruction  in  the  trade 
school  a  fully  equipped  artisan,  mechanic,  or  what  not. 

"  The  work  of  training  the  new  apprentice  really  begins  with  his  last 
year  in  the  elementary  school.  During  that  ycur  the  pupil  will  have  the 
opportunity  of  determining,  through  the  help  afforded  him  at  the  ap- 
prenticeship school,  what  special  work  or  craft  he  desires  to  take  up. 
When  the  time  comes  to  'leave  school'  he  will  have  made  his  choice, 
and  will  \>c  encouraged  to  secure  a  position  in  any  minor  capacity,  such 
as  errand  boy  or  office  boy,  in  such  trade  as  he  may  have  chosen.  In 
this  way  he  will  go  in  some  insight  into  the  business,  whilst  attending, 
for  a  certain  number  of  hours  every  week,  extension  classes  conducted 
on  the  broad  basis  of  general  education.  The  following  year  he  will 
apply  for  admission  to  the  preparatory  industrial  school  belonging  to  the 


TRAINING  THE  EMPLOYEE  187 

to  see  the  value  of  factory  training;  it  is  that  the  community  at 
large  has  been  inclined  to  stand  baffled  before  the  project  of 
equipping  hundreds  of  thousands  of  children  for  life  in  an  indus- 
trial world  where  scant  call  was  made  upon  their  talents  or 
enthusiasms. 

Training  the  employee  is  in  reality  the  work  of  organizing  the 
factory  life  so  that  individuals  who  have  some  native  versatility, 
some  natural  creative  interest  and  desire  to  be  useful  and  to 
associate,  can  find  satisfaction  in  their  work. 

Selected  References 

ADAMS,   H.  C.     Description  of  Industry;  an  Introduction  to  Economics. 

N.  Y.,  Henry  Holt  &  Co.,  1918. 
ALLEN,    C.    R.     Instructor,    the    Man   and   the  Job.     Philadelphia,  J.  B. 

Lippincott  Co.,  1919,  pp.  319-333. 
BEATTY,    A.   J.      Corporation   Schools.     Bloomington,    111.,    Public-school 

Publishing    Co.,    1918.     (School   and    Home    Education    Monographs 

No.  2.) 
COMMONS,  J.   R.     Industrial  Goodwill.     N.  Y.,   McGraw-Hill  Book  Co., 

1919.     pp.  126-142. 
DEWEY,     JOHN.     Democracy     and    Education;    an    Introduction   to    the 

Philosophy  of  Education.     N.  Y.,  Macmillan  Co.,  1916. 
FULD,    L.    F.      Service    Instruction    of    American    Corporations.     Wash., 

Govt.  Print.  Off.,  1917.     (U.  S.  Bureau   of  Education,     Bui  No.  34, 

1916.) 
GILLETTE,   J.    M.     The   Vocational   Concept.     (In  American  Sociological 

Society  Publications,  v.  13,  pp.  70-80,  1918.) 
GILLETTE,  J.    M.     Vocational    Education.     N.    Y.,    American   Book   Co., 

1910. 
GREAT    BRITAIN.     MINISTRY    OF    RECONSTRUCTION.     Interim    Report  of 

the    Committee    on    Adult    Education.     Industrial  and  Social   Con- 
ditions in  Relation  to  Adult  Education.     London,  H.  M.  Stationery 

Off.,  1918. 
HARRIS,    GARRARD.     Redemption  of  the  Disabled.     N.  Y.,   D.  Appleton 

&  Co.,  1919. 
HILL,  H.  C.     Americanization  Movement.      (In  American  Journal  Sociology, 

v.  24,  pp.  609-642,  May,  1919.) 

trade  he  has  chosen.  Here  he  will  be  instructed  for  six  months  in  the 
theory  and  practice  of  his  trade,  whilst,  at  the  same  time,  he  will  con- 
tinue his  attendance  at  the  extension  school.  After  passing  through 
this  stage  successfully,  he  will  receive,  through  the  employment  agency 
connected  with  the  school,  a  suitable  position  as  apprentice,  and  during 
all  his  years  of  apprenticeship,  he  will  continue  to  attend  his  trade 
school  for  one  whole  day  in  each  week.  He  will  not,  in  fact,  finally 
leave  school  until  he  is  nineteen,  and,  even  then  he  may,  after  he  has 
served  his  time  in  the  army,  return  to  school  again  and  take  the  'fore- 
man's course.'  "  Christian  Science  Monitor,  Feb.  13,  1920. 


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HOBSON,  J.  A.  Work  and  Wealth.  N.  Y.,  Macmillan  Co.,  1916,  pp. 
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KRAUSE,  LOUISE  B.  The  Business  Library;  What  it  is  and  What  it  Does. 
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LINK,  H.  C.  Employment  Psychology.  N.  Y.,  Macmillan  Co.,  1919, 
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MANN,  C.  R.  American  Spirit  in  Education.  Wash.,  Govt.  Print.  Off., 
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MAROT,  HELEN.  Creative  Impulse  in  Industry.  N.  Y.,  E.  P.  Dutton  & 
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MAZZINI,  GIUSEPPE.  Duties  of  Man  and  Other  Essays.  N.  Y.,  E.  P. 
Dutton  &  Co.,  1907.  (Everyman's  Library)  Ch.  9. 

NATIONAL  ASSOCIATION  OP  CORPORATION  SCHOOLS.  Annual  Convention ; 
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NORTON,  H.  R.  Department-store  Education.  Wash.  Govt.  Print. 
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PARK,  C.  W.  Cooperative  System  of  Education;  an  Account  of  Co- 
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Bureau  of  Education.  Bui.  No.  37,  1916.) 

RUSSELL,  BERTRAND.  Why  Men  Fight.  N.  Y.,  Century  Co.,  1917. 
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ST.  PHILLIPS  SETTLEMENT  EDUCATION  AND  ECONOMICS  RESEARCH  SOCIETY. 
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Adult  Manual  Workers  for  the  Discharge  of  Their  Responsibilities  as 
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Allen  &  Unwin,  1919. 

SELDEN,  F.  H.  Industrial  Intelligence  and  the  Present  World  Crisis. 
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TALBOT,  W.  Adult  Illiteracy.  Wash.,  Govt.  Print.  Off.,  1916.  (U.  S. 
Bureau  of  Education.  Bui.  No.  35,  1916.) 

U.  S.  COMMISSION  ON  NATIONAL  AID  TO  VOCATIONAL  EDUCATION.  Report. 
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U.  S.  SHIPPING  BOARD,  EMERGENCY  FLEET  CORPORATION.  Industrial 
Relations  Division.  Education  and  Training  Section.  Training 
Shipyard  Workers.  Philadelphia,  U.  S.  Shipping  Board,  Emergency 
Fleet  Corporation,  1919. 

U.  S.  TRAINING  SERVICE.  How  to  Start  a  Training  Department  in  a 
Factory.  Wash.,  Govt.  Print.  Off.,  1919.  (Training  Service  Bui. 
No.  1.) 

U.  S.  TRAINING  SERVICE.  Industrial  Training  in  Representative  In- 
dustries. Wash.,  Govt.  Print.  Office,  1919.  (Training  Bui.  No.  13.) 

U.  S.  TRAINING  SERVICE.  Labor  Turnover  and  Industrial  Training. 
Wash.,  Govt.  Print.  Off.,  1919.  (Training  Bui.  No.  6.) 

U.  S.  TRAINING  SERVICE.  Training  Employees  for  Better  Production; 
a  Symposium  of  Kxprrirm-rs  in  American  Factory  Training  Depart- 
ments. Wash.,  Govt.  Print.  Off.,  1918.  (Training  Bui.  No.  4.) 


THE  COMPANY  MAGAZINE 


The  company  magazine,  or  house  organ,  is  the  medium  for  the 
democratic  collection,  evaluation,  and  distribution  of  informa- 
tion concerning  the  lives,  purposes  and  hopes  of  the  people  in 
the  shop.  It  may  profitably  occupy  an  important  place  in  any 
program  of  employment  administration.  In  the  small  plant  it 
can  intensify  a  feeling  of  common  knowledge  and  understanding. 
In  the  large  plant  it  can  help  substantially,  if  properly  adminis- 
tered, to  bridge  the  distance  between  management  and  men;  it 
can  foster  cooperation  and  friendship;  it  can  help  to  clarify  to 
managers  the  desires  and  purposes  of  the  workers  and  convey 
to  workers  something  of  the  problems  and  purposes  of  the 
management. 

Need  of  Company  Paper.  —  There  are  several  factors  that 
contribute  to  the  value  of  a  plant  paper.  In  no  country  is  the 
average  worker  more  generally  accustomed  to  reading  a  variety  of 
periodicals  than  in  the  United  States.  Most  of  his  information 
on  important  subjects  is  gathered  from  dailies  or  weeklies;  and 
his  habit  of  reading  offers  a  sound  foundation  upon  which  to 
build  a  shop  paper  that  can  give  a  constructive  interpretation 
not  only  of  shop  problems  but  of  wider  public  affairs. 

Within  the  plant  the  need  for  common  knowledge  is  great. 
The  awakening  of  friendly  interest  in  fellow  employees  and  in  the 
management,  the  tying  together  in  fellowship  of  the  various 
departments  and  branches,  and  the  establishing  of  cooperation 
between  the  community  and  the  factory,  all  these  desirable  ends 
may  be  furthered  by  the  company  magazine.  In  industries 
where  personnel  work  is  fairly  well  established,  and  where  the 
functions  of  employment  and  maintenance,  factory  hygiene, 
research  and  training  are  centralized,  the  value  of  a  magazine  is 
especially  great.  The  health  program  which  operates  to  antici- 
pate and  prevent  occupational  dangers  and  illness,  the  shop 
committee  arrangements,  and  the  educational  courses  set  up 
and  directed  in  order  to  discover  and  develop  the  creative  inter- 
ests of  the  workers  —  all  find  an  opportunity  for  interpretation. 

189 


190  PERSONNEL  ADMINISTRATION 

Types  of  Company  Magazines. — Company  magazines  may  be 
divided  into  three  distinct  types:  Those  managed  almost  ex- 
clusively by  the  company;  those  directed  by  employees;  and 
those  operating  on  a  cooperative  basis,  that  is,  controlled  by 
both  employers  and  employees.  The  majority  of  house  organs 
published  today  belong  to  the  first  class.  They  are  generally 
an  adjunct  of  the  advertising  department  and  advertise  the 
product  of  the  company  rather  than  forward  a  broad  educational 
policy.  They  are  "issued  in  the  interest  of"  everything  from 
roofing  tin,  abrasives  and  lubricating  products  to  "concrete 
roads,  streets  and  alleys,"  and  their  mailing  lists  consist  largely 
of  actual  or  potential  customers  of  the  firm  and  friends  of  the 
management.  To  these  publications  employees  are  sometimes 
permitted  to  contribute  personal  items  and  educational  articles, 
but  the  magazines  are  designed  primarily  to  sell  goods  and  are 
therefore  written  by  special  publicity  agents. 

There  are  comparatively  few  shop  papers  managed  by  the 
employees  alone.  Of  these  the  majority  receive  financial  sup- 
port from  the  firm,  and  the  remainder  pay  their  own  expenses 
by  charging  a  small  amount  for  each  issue,  and  by  the  insertion 
of  advertisements.  Their  contents  are  largely  personal  notes, 
short  stories  and  jokes  about  members  of  the  working  force,  and 
while  they  do  a  valuable  service  in  promoting  fellowship  and 
goodwill  between  departments  and  branch  offices,  they  often 
lack  any  clear  purpose  or  policy  because  there  is  no  contact  with 
the  several  divisions  of  the  personnel  department  which  could 
help  to  make  the  organ  a  positive  force. 

The  third  type  of  magazine,  which  is  operated  under  the  direc- 
tion of  both  employers  and  employees,  is  the  one  which  under 
present  conditions  usually  has  the  best  chance  of  becoming  a 
geniunely  cooperative  instrument.  It  is  to  be  found  in  but  few 
plants,  and  the  joint  control  of  management  and  workers  is 
effected  in  various  ways.  In  some  cases,  the  journal  is  published 
by  and  for  the  employees  under  the  supervision  of  the  jx-rsonnel 
department,  or  one  of  its  administrative  divisions.  Sometimes, 
it  is  controlled  by  a  Board  of  Management  on  which  the  employees 
and  the  company  have  an  equal  voice,  and  sometimes  by  a  club 
composed  of  workers  and  representatives  of  the  firm.  In  no  case 
has  a  well-rounded  cooperative  magazine  been  evolved.  A  shop 
paper  of  this  third  class  encourages  growth  in  the  capacity  for 
cooperative  action  and  offers  a  definite  medium  for  its  practise. 


THE  COMPANY  MAGAZINE  191 

Hence,  the  values  that  it  may  have  for  a  company  outweigh  the 
possible  inconvenience  and  mistakes  which  joint  control  may 
bring. 

The  Editorial  Staff. — How  should  the  editorial  staff  be  se- 
lected? The  editorial  staff  in  the  truly  democratic  shop  paper 
would  have  the  approval  of  both  the  rank  and  file  and  the  execu- 
tive force.  It  would  be  composed  of  an  editor-in-chief  who  is 
experienced  in  journalism  and  knows  what  the  workers  want, 
with  perhaps  an  assistant  editor;  both  to  be  chosen  by  the 
management  with  the  endorsement  of  the  employees'  cooperative 
associations  or  shop  council.  Both  of  these  would  in  a  large 
plant  have  to  devote  their  entire  time  to  the  magazine,  and  one 
or  the  other  should  have  sufficient  artistic  sense  to  enable  him  to 
select  and  arrange  illustrations.  The  members  of  the  entire 
force,  managers  as  well  as  laborers,  should  be  encouraged  to 
contribute  both  literary  and  artistic  material.  And  the  factory 
news  should  be  collected  by  men  and  women  appointed  from 
each  department.  Some  firms  call  for  volunteer  reporters,  while 
others  ask  the  foreman  to  select  the  candidate.  It  seems  better, 
however,  to  have  the  news  collector  elected  for  a  period  of  perhaps 
three  or  six  months  by  the  members  of  the  department  which  he 
represents . 

The  editor-in-chief,  his  assistant,  and  the  departmental  re- 
porters constitute  the  Magazine  Board,  which  meets  regularly  for 
the  discussion  of  policy  and  the  selection  and  criticism  of  material. 
The  head  of  the  personnel  department  may  act  in  the  capacity 
of  advisory  editor  and  review  the  paper  before  it  goes  to  press. 

Contents  of  the  Magazine. — The  succees  of  the  company  paper 
will  of  course  depend  upon  the  universal  appeal  of  its  contents, 
and  the  manner  in  which  they  are  selected  and  set  up.  There  is 
no  value  in  a  paper  unless  it  is  cordially  accepted  and  systemat- 
ically read  by  the  people.  First  of  all  the  editors  should  ascer- 
tain the  kind  of  magazine  that  the  workers  and  the  management 
would  like,  and  then,  in  joint  discussion,  determine  the  type  to  be 
launched.  While  such  a  canvass  would  doubtless  reveal  a  wide 
variety  of  preferences — one  editor  says  that  they  embrace  every- 
thing that  has  ever  been  written  in  any  magazine  in  the  world — 
it  would  probably  be  true  that  the  majority  would  desire  a 
journal  which  includes  factory  news,  stories  and  instructive 
articles  that  relate  to  the  business  and  current  events,  exchanges, 
educational,  athletic  and  health  departments,  editorials,  and 
columns  of  value  to  the  families  of  the  employees. 


192  PERSONNEL  ADMINISTRATION 

Factory  News. — Most  men  and  women  in  industry  are  more 
interested  in  the  Factory  News  Department  of  a  paper  than  in 
any  other.  Factory  news  is  a  broad  term.  It  comprises  per- 
sonal notes  on  the  daily  activities  of  employers  and  employees, 
the  current  business  events  of  the  plant,  and  the  happenings  in 
the  community  that  are  related  to  the  life  in  the  factory. 

Friendship  with  fellow  employees  and  with  the  management 
is  promoted  by  the  personal  section  of  the  factory  news.  Its 
subject  matter  is  made  up  of  all  the  varied  happenings  in  the 
plant's  daily  life — humorous  incidents,  promotions,  organization 
changes,  honor  rolls,  returns  from  sick  leaves  and  from  vacations, 
and  the  scores  in  the  factory  athletic  contests.  A  successful 
shop  paper  reporter  writes: 

"If  any  reader  has  taken  a  vacation,  married,  returned  an  umbrella, 
paid  back  a  borrowed  dollar,  bought  a  horse,  automobile  or  baby  car- 
riage, planted  a  war  garden,  built  a  chicken  house,  robbed  a  baby's 
bank,  made  a  speech,  been  reduced,  promoted,  received  a  raise,  won 
anything,  done  anything,  been  in  a  fight,  we're  glad  of  it,  because  that's 
news." 

When,  as  in  large  industries,  there  is  need  of  a  "get  acquainted" 
campaign,  short  biographies  of  the  lives  of  the  members  of  the 
management  and  of  the  oldest  employees,  in  the  order  of  their 
seniority,  may  be  written.  In  each  issue  of  the  magazine  the 
story  of  one  of  the  executive  force  and  one  of  the  workers  may 
appear.  "Guess  who"  contests  are  popular.  One  paper  has  a 
written  description  of  the  men,  which  pictures  their  physical  char- 
acteristics, and  the  position  which  they  hold;  another  publishes 
snapshots;  still  another  procures  photographs  of  the  employees 
which  were  taken  when  they  were  babies  and  accompanies  them 
with  a  humorous  write-up. 

There  is  one  personal  note  that  always  claims  the  attention  of 
any  working  force.  Nothing  appeals  to  the  average  man  more 
than  his  babies.  Most  of  the  company  magazines  recognize 
this  fact,  and  print  all  kinds  of  reproductions  of  proud  parents 
and  their  children.  Often  there  is  a  section  of  the  paper  devoted 
entirely  to  this  phase  of  factory  news. 

The  sports  and  recreation  of  the  workers  form  another  impor- 
tant topic.  The  scores  of  the  football,  baseball,  basket  ball, 
cricket  and  soccer  games  are  interesting  to  the  whole  plant — 
especially  if  the  fine  points  are  cleverly  explained  by  write-ups, 


THE  COMPANY  MAGAZINE  193 

cartoons,  and  snap  shots.  Descriptions  of  boxing  and  wrestling 
matches,  track  meets,  swimming  contests,  and  tennis  tourna- 
ments between  departments  and  with  other  firms  make  absorbing 
reading,  while  the  incidents  on  hunting,  fishing  and  automobile 
trips,  picnics,  and  "hikes"  may  be  the  basis  for  amusing  stories. 

Not  only  may  friendliness  among  the  individual  employees 
be  aroused  by  the  company  magazine,  but  inter-departmental 
interest  may  also  be  stimulated.  Recently,  for  example,  "The 
Telephone  Review"  has  published  four  monthly  editions,  each 
one  of  which  has  been  placed  in  charge  of  one  of  the  four  depart- 
ments of  the  New  York  Telephone  Company.  The  September, 
1919,  number  was  issued  by  the  "Commercial  Department," 
which  selected  its  own  corps  of  editors  and  solicited  articles  from 
the  members  of  its  own  staff. 

Current  events  in  the  business  life  of  the  plant  are  properly 
factory  news  items.  New  machinery,  additions  to  the  building, 
a  large  consignment  of  work,  all  deserve  mention.  An  innova- 
tion which  effects  the  lives  of  the  workers  creates  doubt  and  uncer- 
tainty unless  it  is  explained,  while  men  who  have  worked  day  in 
and  day  out  on  some  minor  portion  of  a  big  job  need  the  stimula- 
tion which  comes  from  hearing  what  happens  to  the  completed 
product.  One  firm  which  builds  airships  tries  always,  when  a 
machine  is  completed,  to  publish  a  short  description  and  a  pic- 
ture of  it  in  action  in  the  shop  paper. 

Outside  the  factory,  as  well  as  within,  events  occur  continually 
which  are  of  importance  to  the  members  of  the  plant,  and  useful 
contacts  with  the  local  recreational,  educational,  and  health 
agencies  can  easily  be  made  through  the  company  magazine. 
The  Factory  News  Department  can  tell  of  opportunities  for 
wholesome  amusements  in  the  neighborhood;  it  can  describe 
the  gymnasiums,  the  parks,  and  the  nearby  country  resorts,  and 
it  can  print  notices  of  the  library  facilities,  and  of  boarding 
houses  and  clubs. 

Editorials.- — Factory  news  has  been  discussed  as  of  first  impor- 
tance because  in  the  present  stage  of  plant  development  it  is  the 
feature  which  is  most  interesting  to  the  largest  number  of  workers. 
It  would  seem  that,  in  a  democratic  company  magazine,  the 
Editorial  Department,  if  it  is  conducted  in  a  spirit  of  cooperation 
may  be  made  to  have  the  next  appeal.  It  may  reflect  the  ideals 
of  the  entire  works  force — the  management  and  the  rank  and  file, 
and  it  may  be  so  directed  as  to  interpret  issues  of  large  significance 

13 


194  PERSONNEL  ADMINISTRATION 

which  affect  the  welfare  of  the  whole  organization.  "It  can  pre- 
sent the  trials  of  the  worker  and  the  tribulations  of  the  foreman 
over  him.  Let  some  of  the  men  talk  about  bosses,  criticising  them 
if  criticisms  are  just.  And  let  foremen  write  about  their  experi- 
ences with  unreasonable  men.  It  can  persuade  some  of  the  radi- 
cal groups  to  reveal  themselves  in  the  organ.  These  men  make 
the  worker  think.  He  needs  to  think.  Ideas  are  never  danger- 
ous when  they  are  expressed  in  the  same  context  with  other  and 
different  ideas.  The  editor  can  swat  their  arguments  if  he  goes 
about  it  in  a  pleasant  and  intelligent  way.  The  plant  organ  can 
discuss  the  trade  union  if  the  editor  knows  the  subject.  In 
fact,  there  should  not  be  a  subject  that  is  a  matter  of  concern  to 
the  working  folk  that  it  should  not  be  free  to  discuss."1  Here, 
if  the  enthusiasm  of  all  can  be  aroused,  the  leadership  of  the  en- 
tire factory,  whether  it  comes  from  the  departments  within  or 
from  sources  outside,  is  aroused  and  developed. 

Stories  and  Instructive  Articles. — The  Department  of  Stories 
and  Articles  should  also  be  open  to  all  the  writers  of  the  plant, 
and  contain  narratives,  instructive  articles  descriptive  of  the 
business,  and  of  employees,  and  employers'  association  meetings. 
Several  company  magazines  even  include  a  poets'  corner. 

The  character  of  the  stories  to  be  published  in  a  plant  paper  is 
always  a  problem.  One  firm,  in  answer  to  a  questionnaire  on 
the  subject  received  some  instructive  replies.  47.6%  of  the 
employees  wanted  articles  about  the  heroism  of  workmen  during 
fire,  flood,  and  storms.  The  deeds  of  war  veterans  would  come 
under  this  head.  31.2  %  liked  stories  which  treated  of  instances 
of  courtesy,  and  of  thoughtfulness  on  the  part  of  those  in  posi- 
tions of  authority.  7.5%  wanted  articles  on  efficiency  and 
training,  while  the  remaining  13.7%  had  desires  too  widely 
divergent  for  classification. 

Articles  which  tell  of  the  development  of  the  firm  and  the  his- 
tory of  the  industry  in  which  the  company  is  engaged  belong 
in  this  department.  A  large  rubber  company,  for  example, 
has  run  a  serial  which  tells  of  the  manufacture  of  rubber  from  the 
beginning  to  the  end.  Another  began  its  first  number  with  an 
illustrated  popular  account  of  the  growth  of  the  business.  Still 
others  print  descriptions  of  travel  which  picture  the  country  from 
which  the  raw  material  comes  and  the  use  of  the  product  when 
it  is  finished. 

1  PARK,  ROBERT  E.  The  Plant  Organ.  U.  S.  Department  of  Labor, 
Division  of  Labor  Administration,  Circular  No.  5. 


THE  COMPANY  MAGAZINE  195 

Resume's  of  labor  laws  may  form  another  important  part  of 
the  informational  section.  The  making  of  laws,  their  administra- 
tion and  interpretation  must  be  brought  to  the  attention  of  the 
industrial  world;  and  daily  press  and  popular  magazines  do  not 
carry  the  message  directly  to  the  shop  and  home  of  the  average 
worker.  This  does  not  mean  that  the  shop  paper  should  become 
a  substitute  for  the  newspaper,  but  there  are  certain  phases  of  the 
law  which  influence  the  lives  of  particular  groups  of  workers 
and  which  can  well  be  interpreted  to  meet  their  needs  through 
the  medium  of  the  company  magazine. 

Educational  Department. — The  workers  who  desire  articles 
on  efficiency  and  training  should  certainly  be  catered  to  in  the 
company  magazine.  In  it  may  appear  short  explanations  of 
technical  processes,  new  methods  and  machines.  In  some  shop 
papers  these  form  the  entire  contents.  The  educational  courses 
offered  by  the  plant  and  by  the  community  may  also  be  an- 
nounced and  explained,  and  firms  that  have  their  own  libraries 
may  give  an  account  of  the  special  exhibits  and  new  books.  One 
company  magazine  prints  a  monthly  list  which  classifies  the 
books  and  articles  that  should  be  read  by  executives,  by  foremen, 
and  by  departmental  workers.  Perhaps,  too,  the  educational 
section  is  the  place  in  which  to  include  mention  of  the 
awards  for  suggestions.  Every  valuable  constructive  idea  might 
well  be  acknowledged  in  the  magazine,  and  comment  made  as  to 
why  it  is  or  is  not  to  be  put  into  effect. 

Health  and  Hygiene. — Where  a  personnel  department  has 
doctors  and  nurses  on  its  staff,  where  foremen  are  being  trained 
in  accident  and  health  work,  and  where  campaigns  by  means 
of  bulletins,  motion  pictures,  shop  talks  and  lectures  are  being 
carried  on,  the  company  magazine  should  also  be  utilized  to  pro- 
mote health  and  safety.  "One  concern  found  that  in  one  year 
its  employees  lost  1,355  days  because  of  accident.  It  now  pub- 
lishes in  its  shop  paper  a  series  of  'Safety  Hints.'  Each  month, 
one  safety-first  plan  is  discussed  in  detail.  The  result  of  this 
plan  is  that  the  number  of  days  lost  each  year  has  been  cut  down 
to  260  and  only  part  of  this  number  is  caused  by  accident." 

Housewives'  Column. — Some  company  magazines  attempt 
to  make  the  women  in  the  homes  of  the  employees  feel  that 
they  are  an  integral  part  of  the  whole  organization,  not  only  by 
asking  for  news  contributions  from  them,  but  by  maintaining  a 
column  for  their  special  benefit.  Favorite  recipes  signed  by 


196  PERSONNEL  ADMINISTRATION 

the  cook,  economy  devices,  and  all  kinds  of  household  hints  are 
published.  Want  and  for  sale  advertisements  printed  without 
charge  are  also  of  practical  value.  The  Housewives'  Column 
may  make  the  shop  paper  of  real  service  in  the  home,  and  be  a 
good  reason  for  its  not  being  thrown  into  the  waste  box  at  the 
plant. 

Cost  and  Make-up. — The  make-up  of  the  magazine  as  well 
as  its  contents  depends  largely  on  the  amount  of  money  that  the 
firm  or  the  employees  have  at  their  disposal.  In  the  long  run, 
however,  the  best  that  can  be  afforded  pays.  In  size,  the  com- 
pany magazine  should  be  a  convenient  one  to  handle.  Those  of 
today  range  from  4X7  inch  booklets  to  13  X  15  news  sheets, 
and  from  four  pages  to  forty.  The  4X7  booklet  may  readily 
be  tucked  into  the  pocket,  but  it  is  not  big  enough  to  permit  the 
use  of  artistic  illustrations,  while  the  larger  papers,  unless  they 
can  be  folded,  are  too  bulky. 

The  magazine  title  should  be  distinctive  and  should  have  some 
connection  with  the  industry.  The  "Fore  River  Log,"  "The 
Morse  Dry  Dock  Dial,"  and  the  "Hydraulic  Press"  are,  for 
example,  well  chosen.  A  decorative  cover  also  helps  to  give 
an  attractive  first  impression,  though  plain  printing  is  better 
than  poor  art  if  a  color  design  is  beyond  the  means  of  the  paper's 
supporters. 

The  illustrations  are  as  important  a  feature  of  the  magazine 
as  are  its  literary  contents.  Most  of  the  information  that  in- 
fluences the  majority  of  people  comes  through  the  eye;  certainly 
much  of  the  interest  in  the  shop  paper  is  centered  about  pictures. 
Most  of  the  journals  use  simply  photographs  and  cartoons. 
Within  the  plant  there  may  always  be  found  several  workers 
who  have  decided  talent  as  artists,  and  who  are  glad  to  contribute 
their  drawings.  Photographs,  however,  make  the  magazine  of 
lasting  value  as  a  record  of  the  daily  life  of  the  plant. 

Company  magazines  are  generally  published  once  a  month. 
Some  firms  have  a  large  monthly  and  a  four  or  five  page  weekly 
edition,  while  others  issue  a  newspaper,  or  special  numbers  at 
times  of  anniversaries  or  when  current  events  of  universal 
interest  to  the  plant  are  taking  place. 

The  item  of  cost  is  important.  Most  firms  that  publish  a 
successful  company  paper  are  emphatic  that  it  is  a  paying  in- 
vestment. The  average  cost  of  a  single  copy  of  a  company 
magazine  ranges  in  the  larger  concerns  from  five  to  ten  cents. 


THE  COMPANY  MAGAZINE  197 

One  company,  which  publishes  30,000  copies  a  month,  finds  that 
the  cost  is  7.79  cents  a  copy.  Another  estimates  that  in  1917  it 
printed  29,000  copies  a  month  at  slightly  less  than  ten  cents  a 
piece,  and,  in  1918,  43,000  copies  a  month,  with  thirty-five  pages 
of  reading  matter  and  an  especially  designed  cover,  at  9.13  cents. 
Still  another  firm  that  distributes  30,000  copies  a  month,  at  9.7 
cents  each,  itemizes  its  yearly  expenses  as  follows: 

Printing $16,580. 63 

Distribution 4,123. 11 

Salaries 6,645.00 

Cover  color  plates 1,870 . 62 

Sketches 963 . 45 

Photographs 845 . 63 

Cuts 1,785. 90 

Rent  and  house  service 883 . 25 

Miscellaneous 1,560 . 50 


$35,258.09! 

Such  a  budget  is  of  course  out  of  the  question  in  a  plant  where 
the  circulation  is  to  be  less  than  1000  or  2000.  In  the  case  of 
these  smaller  plants  the  cost  is  kept  low  by  having  the  editorial 
work  done  by  members  of  the  organization,  by  eliminating  color 
press  work,  by  charging  employees  a  nominal  sum  like  five  cents 
for  the  paper. 

In  several  cases,  the  cost  of  publication  has  been  materially 
reduced  by  setting  up  a  printing  establishment  in  the  plant  itself. 
Where  forms,  records,  labels,  advertising  matter  and  reports 
are  used  in  considerable  number  and  can  also  be  printed  on  the 
same  presses,  the  expense  of  printing  the  magazine  may  be 
reduced  fully  one-third.  One  factory,  which  installed  its  own 
printing  department,  found  that  the  cost  of  the  printing  for  the 
entire  plant  did  not  total  as  much  as  the  previous  cost  of  the 
magazine  alone. 

Whether  the  firm  should  bear  all  the  expense  or  the  employees 
should  share  in  it  is  a  question.  It  is  the  conviction  of  some 
of  the  best  personnel  executives,  however,  that  the  publica- 
tions should  be  sold  rather  than  given  away.  A  concern  which 
issued  a  paper  gratuitously  for  several  months  found  the  ground 
about  the  plant  strewn  with  it.  When  a  few  cents  were  charged, 
the  subscribers  were  far  more  careful.  And  certainly  no  better 
test  of  the  employees  real  interest  in  the  magazine  can  be  de- 

1  Factory,  v.  22,  p.  486,  March,  1919. 


198  PERSONNEL  ADMINISTRATION 

vised  than  their  willingness  to  buy  it  because  of  value  received. 
Yet  some  of  the  most  successful  magazines  have  not  had  any 
difficulty  with  a  free  distribution,  especially  when  the  paper  was 
mailed  to  all  who  sent  in  their  addresses. 

Wisely  directed,  the  company  magazine  can  help  significantly 
to  improve  the  human  relations.  It  provides  a  valuable  oppor- 
tunity for  cooperation  and  it  may  be  made  one  of  the  strongest 
educative  forces  of  the  plant.  The  job  of  reporting,  in  itself, 
if  it  is  rotated,  may  develop  in  many  men  the  knowledge  and 
goodwill  which  comes  from  friendly  contact  and  the  judgment 
which  results  from  the  discovery,  the  selection  and  the  evaluation 
of  important  facts.  It  encourages  both  artistic  and  literary 
talent,  and  is  a  helpful  incentive  to  induce  the  non-English 
speaking  groups  to  learn  English.  It  is  a  medium  to  foster  the 
desire  for  intelligence  and  for  a  broader  understanding  of  the 
common  interests  between  executives  and  workers. 

Selected  References 

KIMBAL,   H.   W.     Fostering    Plant   Spirit    Through   a  Plant  Paper.     (In 

Industrial  Management,     v.  57,  pp.  245-6.     March,  1919.) 
O'SHEA,  P.  F.    The  Shop  Paper  as  an  Aid  to  Morale.     (In  Factory,  v.  23, 

pp.  518-22.     Sept.,  1919.) 
O'SHEA,  P.  F.      The  Shop  Paper  as  an  Aid  to  Self-training.     (In  Factory, 

v.  23,  pp.  791-793.     Oct.,  1919.) 
PARK,    R.    E.    Suggestions   for   Conducting   Plant  Organs.     Washington, 

U.  S.   Working  Conditions  Service,  Division  of  Labor  Administration, 

1919.     (Circular  No.  5.     Apr.  28,  1919.)     6  p.  typewritten. 
RANSAM,    ROBERT  E.     Effective    House    Organ.     N.    Y.,    Appleton    and 

Company,  1920. 
SAYLER,   A.  C.     The  House  Organ  and  Its  Functions.     (In  Personnel,  v.  1. 

no.  12,  p.  11.     Dec.,  1919.) 
SHOP    PAPER    AS    AN    AID   TO    MANAGEMENT.     (In  Factory,  v.  20,  p.  08, 

55G,  776,  880;  v.  21,  p.  34S,  918,  1184;  v.  22,  p.  102,  482,  710,  1098; 

v.  23,  p.  67,  140,  302.     Jan.,  March,  May,  Aug.,  Nov.,  1918.    Jan., 

March,  May,  July,  Aug.,  1919.) 
WILSON,    G.   F.     The    House   Organ;  How  to  Make  it    Produce  Hemilts. 

Milwaukee,  Wis.,  Washington  Park  Pub.  Co.,  I'.U.'i.     Contains  chapter 

on  "Internal  House  Organ." 


CHAPTER  XV 
AROUSING  INTEREST  IN  WORK 

Much  has  been  written  about  the  monotonous  character  of 
present-day  industrial  work;  and  much  is  now  being  written 
about  the  workmanly,  manipulative,  constructive,  creative 
impulses  which  appear  to  be  a  native  part  of  human  equipment, 
and  of  which,  it  is  claimed,  little  use  is  made  or  can  be  made 
in  the  average  factory.  Industry  is  under  indictment  on  the 
serious  count  of  failing  to  provide  any  reasonable  outlet  for  cer- 
tain fundamentally  necessary  and  useful  tendencies  of  the  human 
organism.  It  is  accused  of  cramping  and  stultifying  the  indi- 
vidual; of  making  it  impossible  for  him  to  find  interest  and  ful- 
fillment of  life  in  work. 

Certainly  no  more  serious  situation  could  be  conceived  than 
one  in  which  millions  of  people  are  destined  to  be  confined  for 
eight  or  nine  hours  of  close  application,  to  labors  which  are 
indifferently  or  even  grudgingly  performed.  It  is  hardly  an 
exaggeration  to  say  that  the  permanence,  productivity  and  hu- 
manity of  any  industrial  system,  stands  or  falls  in  the  last  analysis 
upon  its  ability  to  utilize  the  positive  and  constructive  impulses 
of  all  who  work, — upon  its  ability  to  arouse  and  continue  the 
interest  of  the  workers.  The  problem,  therefore,  demands  search- 
ing study  if  we  are  to  answer  such  inevitable  questions  as:  Is 
interest  in  work  as  now  carried  on  possible?  If  it  is  possible, 
how  is  it  to  be  aroused?  If  it  is  not,  how  can  we  so  modify 
conditions  that  interest  will  arise? 

The  question  of  interest  in  work  is  an  intensely  practical  one. 
The  fact  that  much  of  the  discussion  of  it  has  bordered  on  the 
sentimental  need  not  disturb  us  if  we  will  preface  our  study  with  a 
careful  analysis  of  the  concepts  of  "interest"  and  of  "monotony." 

People  are  interested  when  an  activity  tends  to  keep  occupy- 
ing the  attention — that  is,  absorbing  them  by  some  appeal 
either  of  its  difficulty,  of  downright  enjoyment  in  its  performance, 
of  approbation  of  one's  fellows  because  of  proficiency,  or  of  some 
other  significance  in  the  activity.  People  are  interested  when 
attention  has  passed  the  point  of  conscious  effort  and  becomes 

199 


200  PERSONNEL  ADMINISTRATION 

eager,  immediate  and,  so  to  say,  spontaneous.  Attention  can 
be  so  commanded  when  we  are  actively  engaged,  have  a  definite 
object  to  attend  to,  and  recognize  something  at  stake,  "something 
whose  outcome  is  important  for  the  individual."1 

A  display  of  interest  is  therefore  a  display  of  "self-expressive 
activity."  One  is  interested  when  one  can  register  in  the  activity 
— in  terms  of  self  and  group  approval, — register  in  the  doing  and 
in  the  result.  And  that  sense  of  self-satisfaction  can  grow  only 
as  the  root  desires  of  the  individual  are  being  realized.  What 
those  root  desires  are,  we  have  already  considered.  We  want  to 
and  we  must  register  in  terms  of  manipulation,  workmanship, 
creation;  in  terms  of  group  conformity  and  recognition,  of 
emulation,  and  curiosity.  Wherever,  said  William  James,  a 
process  of  life  communicates  an  eagerness  to  him  who  lives  it, 
there  the  life  becomes  genuinely  significant. 
(  Important  elements  in  a  condition  of  interest  are  therefore 
self-choice  of  the  activity,  pleasure  in  its  continuance,  a  sense  of 
significance  and  value  in  its  performance,  and  opportunity  to 
secure  the  approval  of  one's  associates.  ) 

A  condition  of  monotony  exists  where  these  elements  are 
lacking.  Remove  the  chance  for  self-choice  of  the  action,  for 
understanding  its  significance,  for  having  the  approval  of  one's 
fellows,  and  the  labor  is  sheer  drudgery.  "Monotony  means 
that  growth,  development,  have  ceased."2  Monotony  is 
present  when  work  has  become  so  habitual  as  to  be  automatic, 
(that  is,  it  is  making  no  demands  upon  the  active  attention); 
or  when  work  is  found  to  be  temperamentally  uncongenial,  or  is 
thus  for  any  reason  precluding  the  chance  for  self-expression 
and  development  through  the  work. 

If  these  definitions  are  correct,  interest  and  monotony  are  not 
characteristics  of  certain  kinds  of  work.  They  are  character- 
istics of  people  in  their  reaction  to  work.  A  job  is  not  inherently 
interesting  nor  inherently  monotonous.  It  is  interesting  or 
monotonous  to  a  worker.  There  are  inevitably  these  two  aspects 
contributing  to  create  the  one  fact  of  the  worker-in-his-relation- 
to-his-work.  The  two  must  in  each  separate  case  fit;  the 
worker  must  find  the  job  that  satisfies  him.  He  must  be  able  to 
register  there;  and  in  order  that  this  may  happen  it  must  fit  from 

1  In  this  whole  discussion  we  recognize  our  debt  to  PROFESSOR  JOHN 
DBWBY'S  Interest  and  Effort  in  Education.    See  p.  16. 
*  DEWEY,  JOHN,  op.  tit.,  p.  36. 


AROUSING  INTEREST  IN  WORK  201 

the  point  of  view  of  the  opportunity  for  him,  in  relation  to  his  ca- 
pacity, and  in  relation  to  his  motives  and  desires.  It  is,  in  short, 
a  dynamic  and  changing  fact.  The  worker  is  either  progressively 
more  interested  because  the  adjustment  is  always  improving; 
or  he  is  progressively  less  interested — and  usually  less  capable  of 
being  interested  in  the  work.1 

Jobs  as  jobs,  therefore,  are  neither  interesting  nor  the  opposite. 
It  all  depends  on  the  relationship  between  individual  jobs  and 
individual  workers.  But  there  are,  of  course,  jobs  which  because 
of  their  simple  content  do  quickly  become  habitual  and  then 
automatic.  Any  prolonged  performance  of  such  operations 
will,  of  course,  become  monotonous  and  whether  or  not  these 
jobs  as  now  constituted  can  of  themselves  be  interesting  is  in  our 
opinion  a  grave  question.  The  possibility  of  developing  a 
derived  interest  for  this  type  of  work  must  be  considered.2 

But  there  are  many  jobs  usually  thought  of  as  monotonous, 
which  require  thought,  care  and  attention,  and  could  therefore 
be  much  more  interesting  than  they  are,  if  only  the  worker  had 
the  knowledge,  ability,  aptitude  and  background,  out  of  which 
interest  would  normally  arise.3 

1  See  A  Point  of  View  in  the  Field  of  Industrial  Personnel,  The  Scott  Co., 
Laboratory,  June  24,  1919. 

2  Suppose,  for  example,  it  is  true,  as  an  able  psychiatrist  recently  re- 
marked,  "The   feebleminded    make  the  best  machine  feeders."     Are  we 
to  draw  the  obvious  conclusion  as  to  standards  of  selection  for  machine 
feeders?     Or  are  we  to  say  that  where  the  worker  does  "mind "  the  machine 
(significant  expression),  and  no  special  mental  fitness  is  required  by  the 
immediate  claims  of  the  job,  we  shall  attempt  to  compensate  for  this  re- 
striction by  other  activities — within  industry,  if  possible;  and  outside  it, 
if  this  is  not  possible? 

3  An  interesting  illustration  of  this  is  given  by  P.  H.  Selden,  Have  We 
A  Just  Standard  of  Industrial  Intelligence?  In  American  Journal  of  Sociology, 
May,  1919,  v.  24,  p.  646.     "Usually,  only  cheap  help  was  employed  at 
this  machine,  as  the  foreman  prided  himself  on  getting  work  out  at  a  mini- 
mum of  expense.     The  regular  hand  quit  and  it  was  necessary  to  put 
another  man  in  his  place.     The  new  operator  looked  the  machine  over, 
fixed  it  up,  and  decided  to  run  it  on  a  faster  speed.     To  do  this  he  must 
watch  it  very  closely.    .    .    .   This  necessitated  his  keeping  his  ear  close 
to  the  cutter.     Being  a  tall  person,  this  could  be  accomplished  without 
undue  fatigue  only  by  sitting  down.     He  got  a  nail  keg  and  sat  close  to  the 
machine,  but  as  his  ear  was  directed  toward  the  cutter  his  eyes  were  appar- 
ently looking  about  the  room.     Only  a  day  or  so  elapsed  before  the  fore- 
man called  him  down  for  his  lazy  tendencies  in  sitting  at  his  work.     This,  of 
course,  resulted  in  his  putting  his  machine  back  on  slow  speed  and  assuming 
an  attentive  attitude." 


202  PERSONNEL  ADMINISTRATION 

This  points  to  a  fundamental  need — the  need  for  analysis  of  the 
intellectual  content  of  jobs.  From  the  point  of  wise  selection  of 
workers,  promotion,  transfer,  modifications  in  process  and  train- 
ing, we  need  more  exact  data  as  to  what  qualities,  aptitudes, 
traits  of  temperament  and  technical  knowledge  each  job  demands. 
Such  study,  we  can  confidently  predict  from  all  the  job  analysis 
which  has  thus  far  been  done,  will  reveal  an  astonishing  amount  of 
special  skill  required  at  many  supposedly  monotonous  tasks. 

Such  study  will,  moreover,  tell  us  how  many  jobs  of  each 
different  kind  there  are  in  a  factory.  We  know  that  it  is  inac- 
curate to  speak  of  all  factory  work  as  repetitive  drudgery.  The 
work  of  machine  maintenance  occupies  some  workers.  The 
handling  of  materials  and  trucking  occupies  others.  There 
is  assembling,  inspection,  packing,  shipping.  The  actual  pro- 
portion of  unskilled  machine-feeders  varies  from  plant  to  plant; 
but  apparently  it  runs  between  forty  per  cent,  and  eighty  per  cent. 
We  must  not  ignore  the  fact,  however,  that  the  elements  of  in- 
security in  the  job,  non-control  over  work,  little  significance  in 
the  work,  little  chance  for  fellow  workers'  approval,  may  all 
be  present  at  repetitive  and  non-repetitive  jobs  alike,  and  that 
monotony  exists  wherever  the  chance  to  make  the  job  one  with 
one's  self  is  no  longer  present. 

The  Worker's  Attitude  Toward  Interest. — Our  discussion  of 
methods  of  arousing  interest  in  work  will  be  clearer  if  we  consider 
next  two  important  objections  to  any  definite  effort  in  this 
direction.  It  is  said,  first,  that  workers  seem  to  like  automatic 
jobs;  second,  that  they  don't  want  to  be  interested  in  their  work. 
Both  points  have  such  elements  of  truth  in  them  that  they 
deserve  careful  scrutiny. 

There  are  at  least  two  important  reasons  why  some  workers 
seem  to  like  automatic  jobs.  The  job  must,  of  course,  always 
be  seen  in  relation  to  the  individual's  capacities  and  to  his 
desires.  The  capacity  and  desire  of  a  given  worker  ;s  determined 
by  many  factors.  But  second  to  none  in  significance  are  tho 
factors  which  moulded  his  life  and  outlook  from  birth  to  his  fifth 
or  sixth  year.  A  childhood  spent  in  the  restrictions  of  a 
tenement  environment  with  its  precocious  developments  in  some 
directions,  its  enforced  repressions  in  others,  its  complete  efface- 
incrit  of  certain  qualities  and  values,  may  well  create  a  mental 
life  which  is  incapable  of  securing  the  normal  responses. 
"Repression,"  it  has  been  thoughtfully  said,  "often  expresses 


AROUSING  INTEREST  IN  WORK  203 

itself  very  strikingly  in  the  decrease  of  such  emotions  as  have 
been  present  and  the  non-appearance  of  expected  new 
emotions." 

The  repression  may  be  an  infantile  one ;  it  may  be  due  to  long 
years  of  dull,  unpromising  work.  But  the  fact  remains  that 
individuals  are  responding  to  stimuli  in  a  pathological  way  when 
they  are  content  with  automatic  jobs. 

Again,  this  repression  may  be  invited  and  continued  because 
of  the  habits  and  attitude  of  the  surrounding  group.  John 
Stuart  Mill  gives  an  accurate  characterization  of  much  working 
class  behavior  when  he  says, 

"Even  in  what  people  do  for  pleasure,  conformity  is  the  first  thing 
thought  of;  they  like  in  crowds.  .  .  .  until  by  dint  of  not  following 
their  own  nature,  they  have  no  nature  to  follow;  they  become  incapable 
of  strong  wishes  or  native  pleasures,  and  are  generally  without  either 
opinions  or  feelings  of  home  growth,  or  properly  their  own." 

In  other  words,  lack  of  interest  breeds  lack  of  interest,  until  a 
situation  arises  wherein  it  may  actually  be  bad  form  to  like  one's 
job. 

There  remains  the  second  objection  that  workers  do  not  want 
to  be  interested  in  their  work.  Where  this  is  the  case,  it  is  often 
true  that  habituation  to  drudgery  has  led  to  a  more  or  less  un- 
conscious conclusion  that  work  cannot  be  interesting.  Many 
older,  habituated  routineers  undoubtedly  hold  this  conviction; 
the  hope  is  with  the  younger,  less  fixated  groups. 

It  is  indeed  hard  to  visualize  the  outlook  and  environment  as  it 
may  present  itself  to  the  worker. 

"It  is,"  says  an  observing  economist,  "not  sufficiently  considered  how 
little  there  is  in  most  men's  ordinary  life  to  give  any  largeness  either  to 
their  conceptions  or  to  their  sentiments.  Their  work  is  routine;  not 
a  labor  of  love,  but  of  self-interest  in  the  most  elementary  form,  the 
satisfaction  of  daily  wants;  neither  the  thing  done,  not  the  process  of 
doing  it,  introduces  the  mind  to  thoughts  or  feelings  extending  beyond 
the  individual ;  if  instructive  books  were  within  their  reach,  there  is  no 
stimulus  to  read  them;  and,  in  most  cases,  the  individual  has  no  access 
to  any  person  of  cultivation  much  superior  to  his  own.  Giving  him 
something  to  do  for  the  public  supplies,  in  a  measure,  all  these  deficien- 
cies. If  circumstances  allow  the  amount  of  public  duty  assigned  to 
him  to  be  considerable,  he  becomes  an  educated  man."1 

1  MILL,  J.  S.     Representative  Government,  Chapter  III. 


204  PERSONNEL  ADMINISTRATION 

There  is,  finally,  the  fear  of  exploitation  if  interest  in  work  is 
pushed  to  a  point  where  the  employer  gets  a  much  larger  pro- 
portionate return  for  increased  product  than  the  worker.  There 
is  reason  for  this  fear;  and  no  manager  who  wants  to  introduce 
a  thorough-going  program  to  secure  interest  can  neglect  to  recog- 
nize the  place  of  rewards  in  the  scheme  of  incentives.  To  stress, 
as  some  have,  the  phrase  "non-financial"  incentives,  is  almost 
to  prejudice  in  advance  the  case  for  greater  interest. 

To  be  sure  the  sole  and  primary  incentive  to  interest  and  ef- 
fort is  not  the  pay  envelope.  The  most  deep  rooted  incentives 
are  non-financial.  But  that  does  not  argue  for  any  ignoring  of 
the  financial  considerations  or  of  the  necessity  for  doing  justice  in 
the  matter  of  income  distribution.  The  arousing  of  interest  is 
not  synonomous  with  efforts  to  "speed  up"  production,  to  cut 
wage  rates,  to  increase  profits.  At  that  moment  when  workers 
foel  they  are  being  tricked  into  interest  in  work  in  order  that 
their  employer  may  get  added  returns,  the  game  will  bo  up  with 
the  employer.  Hand  in  hand  with  the  development  of  methods  of 
stimulating  interest  in  work,  must  go  methods  of  decentralizing 
control  over  process  and  over  earnings.  How  this  may  bo  done 
we  are  considering  in  other  chapters.  The  immediate  point 
is  that  the  creation  of  interest  in  work  is  not  a  Machiavellian 
enterprise  in  which  something  can  be  given  with  one  hand  and 
taken  with  the  other. 

In  short,  the  efforts  of  the  employment  administrator  to  make 
work  interesting  arc,  if  they  are  intelligently  pursued,  neither 
disruptive  of  morale  nor  exploitive  in  character.  In  stimulating 
interest  we  are  endeavoring  to  hasten  an  educational  process 
which  shall  simultaneously  arouse  discontent  with  a  meager, 
narrow  life  and  provide  channels  for  securing  the  permanent 
satisfactions  of  a  life  of  wider  outlook  and  constant  growth. 

Because  this  is  an  educational  process,  it  is  not  calculated  to 
disrupt  the  whole  scheme  of  workers'  habits  and  outlook  so  that 
they  arc  without  stability.  Nor  is  it  necessarily  calculated  to 
stir  up  longings  which  cannot  be  satisfied,  nor  to  let  loose  im- 
pulses and  desires  which  arc  anti-social  in  thoir  manifestations 
and  consequences. 

To  create  interest  in  work  means  rather  to  make  work  con- 
tribute to  the  upbuilding  of  personality;  it  is  to  attempt  to 
restore  a  greater  unity  to  life,  and  remove  the  pivs<-nt  \vi<l»-  gulf 
between  work  and  pleasure,  between  the  getting  of  a 


AROUSING  INTEREST  IN  WORK  205 

and  the  living  of  a  life.  To  create  interest  in  work  is  thus  a 
fundamental  part  of  the  educational  function  of  the  factory. 
And  there  are  practical  methods  by  which  this  education  can  be 
undertaken. 

These  methods  are  discussed  in  the  remainder  of  the  chapter, 
not  on  the  assumption  that  any  one  plant  can  or  should  neces- 
sarily adopt  them  all;  but  because  together  they  offer  a  program 
of  action  in  a  campaign  of  securing  interest,  which  is  compre- 
hensive and  worth  working  on  over  a  period  of  years.  It  is  not 
a  problem  which  can  be  solved  by  cure-alls;  a  balanced  plan  is 
essential. 

Regular  and  Permanent  Work. — The  time  has  come  for 
managers  to  admit  that  they  cannot  expect  interest  from  workers 
whose  jobs  are  constantly  uncertain.  It  is  humanly  impossible 
to  expect  a  degree  of  loyalty  in  a  situation  where  the  tenure  of 
employment  depends  almost  entirely  upon  the  foreman's  or 
manager's  pleasure,  or  even  upon  the  state  of  business.  There 
is  no  premium  on  conscientious,  willing  and  skillful  work,  if 
good  and  poor  workers  alike  are  subject  to  the  unforeseen  lay- 
offs and  discharges  now  unfortunately  so  prevalent. 

This  is  not  the  place  to  propose  methods  for  regularizing 
employment.1  But  it  is  very  much  in  place  to  call  attention  to 
the  psychological  impossibility  of  fostering  interest  in  work  while 
there  is  no  security  of  employment.  It  is,  for  example,  a  com- 
monplace observation  that  seasonal  workers  toward  the  end 
of  the  busy  season  will  often  turn  out  fifty  per  cent,  less  work  per 
day  than  earlier  when  they  know  there  is  plenty  of  work  ahead. 

Basic  in  a  program  for  securing  interest  are  provisions  which 
will  give  a  reasonable  security  of  livelihood,  provided  workman- 
ship of  quality  is  displayed. 

More  Careful  Selection. — It  is  a  natural  conclusion  from  our 
definitions  of  interest  and  monotony  that  a  given  worker  will  be 
interested  by  some  jobs  and  bored  by  others.  Much  may  be 
accomplished  by  seeing  to  it,  therefore,  by  methods  which  we 
have  already  discussed,  that  selection  takes  place  which  intel- 
ligently relates  the  quality  of  the  man  to  the  character  of  the 
job.  This  does  not,  of  course,  meet  the  problem  of  those  jobs 
of  low  mental  content  which  with  a  half  day's  instruction  anyone 
can  do.  But  it  does  reveal  the  importance  of  giving  the  person 
of  sedentary  disposition  sedentary  work,  the  person  of  delicate 

1  See  Chapter  XXVII. 


206  PERSONNEL  ADMINISTRATION 

tactile  sense,  precise  manual  work;  the  man  who  likes  to  meet 
people,  work  with  people;  and  so  on  through  all  the  combinations 
of  human  characteristics  which  we  know  and  for  which  up  to  a 
certain  point  temperamentally  congenial  industrial  pursuits  can 
be  selected. 

Nor  can  this  selection  safely  be  considered  as  ever  quite  finally 
accomplished.  The  workers'  attitude  toward  a  particular  job 
may  change  and  when  it  does,  it  becomes  necessary  to  get  a  better 
adaptation  of  man  to  job.  There  should,  in  short,  be  a  constant 
process  of  selection — which  of  course  merges  into  transfer. 

Knowledge  of  the  Processes  of  the  Industry  as  a  Whole. — To 
the  person  capable  of  dramatizing  it  in  his  mind's  eye,  the  struc- 
ture of  industry  as  a  whole  presents  itself  as  a  fascinating  inter- 
relation of  parts  and  functions.  The  organization  within  each 
industry  is  equally  a  matter  of  interest.  In  almost  every 
industry  the  discovery  and  development  of  the  methods  of 
securing  and  utilizing  raw  materials  is  an  interesting  story  which 
commences  in  prehistoric  origins.  The  securing  of  materials  in 
the  world  markets,  its  transportation,  the  whole  process  of 
manufacture,  methods  of  studying  the  demand,  the  distribution, 
advertising  and  selling — all  these  present  a  range  of  effort  and 
activity  which  is  stirring  as  well  as  illuminating.  Each  worker 
in  every  industry  has  the  right  to  know  these  things  about  his  own 
industry.  He  has  a  right  to  be  a  conscious  partner  in  the  world 
enterprise  to  which  his  trade  is  related.  The  sense  of  personal 
significance  which  comes  with  such  knowledge  is  real  and 
necessary. 

The  ways  of  imparting  this  knowledge  are  numerous  and  there 
is  room  for  infinite  ingenuity  in  devising  new  methods.  Tho 
instructional  staff  of  the  plant  should,  from  the  outset,  be  charged 
with  this  work  of  education.  Classes  of  new  workers  might  be 
held  every  few  months — as  often  as  enough  now  workers  have 
entered  the  plant;  and  they  should  run  for  a  number  of  weeks, 
twice  or  three  times  a  week.  The  use  of  moving  pictures  to 
illustrate  the  sources  of  raw  materials  and  processes  of  their 
development;  the  use  of  special  experts  to  lecture  on  different 
aspects  of  the  production  process,  as  well  as  on  the  uses  and 
methods  of  distribution  of  the  product;  visits  of  the  class  through 
the  entire  plant;  the  use  of  selected  employees  in  a  versatile 
flying  squadron;  the  use  of  employees  in  rotation  as  factory  guides 
for  visitors;  the  invitation  of  the  families  of  workers  to  go  through 


AROUSING  INTEREST  IN  WORK  207 

the  plant  on  a  visit ;  the  use  of  the  right  type  of  company  magazine ; 
the  preparation  of  specially  adapted  text  books;'  instruction  in 
the  use  of  production  records;  consideration  with  the  advertising 
department  of  effective  ways  of  popularizing  all  this  material — 
these  are  all  methods  in  use  in  one  plant  or  another,  and  experi- 
ence amply  justifies  their  extension. 

And  the  time  has  come  to  include  instruction  in  the  elements  of 
general  economics;  although  there  is  the  danger  that  the  subject 
will  be  taught  with  a  view  to  justifying  existing  practices.  It 
should  be  purely  descriptive  economics;  although  such  funda- 
mental considerations  as  the  following  should  be  illustrated  by 
facts : 

Industry  cannot  distribute  more  than  it  produces. 

"Economic  laws"  are  not  a  statement  of  absolute  and  immuta- 
ble principles, — they  are  attempts  to  describe  existing  facts. 

Human  wants  are  practically  inexhaustible,  hence  the  more 
there  is  produced,  the  more  will  be  consumed  (provided  there  is  a 
high  level  of  wages,  popular  leisure  and  some  one  does  not  step  in 
to  monopolize  the  production,  inflate  prices,  etc.) 

Training  for  the  Job. — It  goes  without  saying  that  the  worker 
who  has  been  properly  inducted  into  the  intricacies  and  the 
"why"  of  his  own  job  will  like  it  better  and  do  it  better  than  the 
person  who  proceeds  wholly  by  rote  or  imitation.  There  are 
good  and  bad  ways  of  doing  every  operation;  and  the  man  who  at 
the  start  is  skillfully  taught  the  right  way  with  the  reason,  is  in 
that  mental  attitude  from  which  interest  arises.  This  is  especi- 
ally true  if  the  management  is  of  a  character  which  assumes  that 
'•'the  right  way"  is  at  any  time  subject  to  change  if  real  improve- 
ments are  suggested. 

The  Use  of  Records  of  Production. — We  have  already 
pointed  out  how  important  it  is  for  foremen  to  be  put  in  possession 
of  the  production  records  of  their  department.  It  is  no  less  im- 
portant for  the  worker  to  be  in  possession  of  his  own  individual 
or  group  production  record. 

Convincing  evidence  of  the  value  of  production  records  to 
create  workers'  interest  in  their  jobs  has  been  published  by 

1  The  literature  of  the  mechanism  of  individual  industries  is  gradually 
developing.  But  much  of  it  needs  adaptation  for  use  with  manual  workers. 
The  B.  F.  Goodrich  Co.,  of  Akron,  O.,  has  already  prepared  as  Volume  I 
in  a  reading  course  for  employees,  A  Wonder  Book  of  Rubber.  The  name 
itself  is  suggestive  of  the  dramatic  possibilities  in  the  story  of  an  industry. 


208  PERSONNEL  ADMINISTRATION 

Robert  B.  Wolf.^  His  results  have  been  so  widely  discussed  that 
it  is  unnecessary  to  do  more  than  call  attention  to  his  experi- 
ences here.  His  conclusions,  drawn  from  the  paper  making  in- 
dustry, are  briefly  as  follows: 

"These  records  we  found  to  be  grouped  under  three  general  classes: 
quantity  records,  quality  records  and  economy  or  cost  records.  Quality 
records  are,  perhaps,  of  the  greatest  importance  for  they  bring  the 
individual's  intelligence  to  bear  upon  the  problem  and  as  a  consequence 
by  removing  the  obstacles  to  uniformity  of  quality,  remove  at  the  same 
time  the  obstructions  to  increased  output.  The  creative  power  of  the 
human  mind  is,  however,  not  content  simply  to  produce  the  best 
quality  under  existing  conditions  of  plant  operation.  So  the  desire  to 
create  new  conditions  for  the  more  highly  specialized  working  eut  of 
.  .  .  the  process  ...  at  once  takes  the  form  of  suggestions  for  im- 
provements in  mechanical  devices. 

"Because  of  the  interrelation  of  Quality,  Quantity  and  Economy  rec- 
ords, any  complete  record  of  individual  progress  must,  of  course,  take 
them  all  into  account."1 

Mr.  Wolf's  results  would  be  significant  by  themselves.  But 
there  is  an  increasing  body  of  testimony  from  other  plants  to 
confirm  his  conclusions.  One  plant  displayed  a  large  black 
board  on  the  wall  at  the  end  of  one  department.  The  board  was 
so  ruled  that  every  man's  production  could  be  recorded  every 
hour;  one  hour  the  amount  would  be  projected  in  white  chalk, 
against  each  man's  name,  the  next  hour  in  red,  etc.  A  normal 
day's  output  was  formerly  considered  to  be  about  1400  units. 
At  the  end  of  the  first  day's  use  of  the  published  production 
record,  several  workers  produced  over  2000  units  and  all  went 
above  1800.  Today  between  1800  and  2100  units  are  considered 
a  normal  output.2 

An  Knglish  accountant  writing  on  the  value  of  a  knowledge 
by  the  workers  of  a  department  of  the  costs  involved,  cites  the 
following  experience: 

1  From  The  Creative  Workman,  an  address  published  by  The  Technical 
Association  of  the  Pulp  and  Paper  Industry,  New  York,  1918.  Mr.  Wolf's 
writings  are  listed  at  the  end  of  this  chapter. 

*  It  should  be  emphasized  that  such  an  innovation  is  not  without  serious 
danger  of  abuse.  The  above  illustration  is  given  at  its  face  value,  but  it 
would  be  necessary,  before  passing  final  judgment  on  its  success,  to  know 
what  effect  the  increasing  speed  of  work  had  on  the  workers,  on  the 
continuity  of  their  work  and  on  their  pay. 


AROUSING  INTEREST  IN  WORK  209 

"At  a  certain  factory  the  tool-room  cost  for  each  production  unit  of 
1,000  articles  manufactured  was  10s.  ($2.43);  at  a  corresponding  factory 
the  cost  was  4s.  6d.  ($1.10)  per  unit.  In  eight  months  after  a  costing 
system  was  introduced  in  the  tool-room  the  cost  per  unit  was  reduced 
from  10s.  ($2.43)  to  2s.  lOd.  ($0.69)  per  unit.  Improvements  effected 
by  the  introduction  of  this  system  were:  (1)  The  firm  reduced  the  tool 
cost  by  72  per  cent.;  (2)  the  tool-room  operatives  earned  higher  wages 
owing  to  the  reduction  in  wasters  and  consequent  increased  produc- 
tion; (3)  the  foremen  and  charge  hands  received  a  bonus  above  their 
normal  wages ;  (4)  the  works  operatives  were  insured  a  regular  supply  of 
tools,  thus  facilitating  production  and  avoiding  the  idle  time  which  had 
previously  occurred."1 

Again,  a  number  of  plants  where  the  raw  materials  used  are 
expensive  (e.g.  hides,  rubber,  copper)  testify  that  workers  are 
much  more  careful  of  material  as  soon  as  they  appreciate  its  value. 
A  recent  writer  tells  of  a  gang  of  men  soldering  tin  cans,  who 
were  using  from  11  to  19  ounces  of  solder  per  100  cans,  where 
experiment  showed  that  nearer  5%  ounces  was  the  right  amount. 
The  men  were  consulted  and  it  was  arranged  that  the}'  should 
share  in  the  value  of  the  solder  saved.  "Now  these  men  are 
turning  out  more  cans  a  day  than  they  ever  did  before  and  aver- 
age from  3  to  7  ounces  of  solder  per  100  cans  ....  The  same 
plan  has  worked  out  with  equal  success  in  operations  involving 
the  use  of  sand  paper,  silk  thread  in  a  sewing  room,  ink  in  a 
printing  shop,  ribbon  on  hats,  brass  wire  in  electrical  work  and 
so  on."2  We  cite  this  not  because  we  are  convinced  that  the 
bonus  is  the  determining  incentive  but  because  of  the  new  atti- 
tude it  exemplifies.  A  knowledge  of  costs  is  equally  important 
where  expensive  instruments  and  tools  are  used,  the  value  of 
which  is  often  not  appreciated  by  workers.  It  is  a  good  rule  to 
be  sure  workers  know  exactly  the  market  value  of  all  instruments, 
tools,  equipment,  machines  and  materials  which  they  use.  Rec- 
ords of  quantity,  of  quality,  of  amounts  of  waste,  of  unit  costs 
and  perhaps  of  other  factors  are  of  great  value ;  but  care  must 
be  taken  that  they  are  presented  in  the  right  way.  They  should, 
for  example,  be  in  as  simple  and  intelligible  form  as  possible;  if 
this  is  accomplished  best  by  graphic  charts,  these  should  be 

TENKINSON,  WEBSTER  M.  The  Workers'  Interest  in  Costing.  As  re- 
viewed in  the  U.  S.  Bureau  of  Labor  Statistics.  Monthly  Labor  Review,  v.  8, 
j_p.  1542-3,  May,  1919. 

BASSETT,   WM.   R.     Developing  Pride  and  Interest  in  the  Job.     (In 
factory,  v.  22,  pp.  693-6,  Apr.,  1919.) 
14 


210  PERSONNEL  ADMINISTRATION 

used.  The  records  should  also  be  comparative  with  those  of 
previous  days,  weeks  and  months;  and  there  should  be  an 
opportunity  to  compare  results  from  one  year  to  another. 

Records  of  this  type  arc  different  from  a  type  of  "efficiency 
record"  which  has  been  attempted  in  some  plants.  The  effi- 
ciency record  appears  usually  in  terms  of  percentage — the  per 
cent,  that  each  worker's  output  is  of  a  given  "bogey  "  or  standard 
day's  work.  In  one  plant  this  bogey  was  set  so  high  by  the  man- 
agement that  workers  rarely  got  over  70  per  cent,  "efficiency." 
When  the  workers  discovered  the  reason  for  this,  they  lost  inter- 
est in  comparing  their  rating  with  the  next  man's  and  with  their 
own  from  day  to  day;  and  the  record  was  eventually  discarded. 

Under  any  conditions,  if  the  record  is  to  be  used  to  stir  up  a 
spirit  of  competitive  emulation  or  a  constant  and  hectic  rivalry,  it 
will  be  in  danger  of  digging  its  own  grave.  Unless  the  workers 
themselves  have  the  scheme  in  part  under  their  own  control  and 
agree  with  the  management  as  to  a  maximum  output  that  is  safe 
to  health  to  secure,  exact  promises  that  there  will  be  no  rate  cut- 
ting and  agree  on  standards  of  quality,  normal  unit  costs,  amounts 
of  waste,  number  of  seconds,  etc.,  any  scheme  of  competitive 
speed-up  will  be  of  little  value.1  It  is  because  such  agreement 
can  be  best  secured  through  some  form  of  committee  action  that 
we  consider  this  as  the  next  means  of  fostering  interest. 

Workers'  Committee  Action  on  Production  Problems. — We 
desire  to  stress  a  function  of  shop  committees  and  a  type  of  shop 
committee  not  usually  dwelt  upon  today.  The  test  of  the  vital- 
ity of  committee  action  is  not  to  be  its  success  in  handling  per- 
sonal maladjustments  which  have  arisen;  the  test  is  rather  in 
its  ability  to  arouse  and  continue  a  serious  interest  in  the  produc- 
tion problem  as  such,  in  process,  methods,  specifications,  for- 
mula, etc. 

There  arc  good  reasons  why  this  increasing  interest  in  process 
must  take  place.  For  there  arc  a  number  of  factors  relating  to 
the  production  process  which  require  harmonious  decision  if  the 
work  is  to  proceed  smoothly.  Those  arc,  first,  methods  of  car- 
rying on  the  work  as  the  process  stands;  and,  second,  agreement 
upon  the  adoption  of  changes  and  improvements  in  process. 

It  is,  for  example,  important  to  know  how  long  it  should 
reasonably  take  to  do  an  operation;  how  many  of  those  opera- 
tions can  be  safely  done  in  a  day  or  week;  what  motions  and 

1  Further  discussed  in  Chapters  XVIII  and  XIX. 


AROUSING  INTEREST  IN  WORK  211 

methods  are  quickest  and  least  fatiguing;  what  the  variable 
elements  are  which  affect  quality;  etc.  The  securing  of  this  in- 
formation and  the  adoption  of  terms  of  employment  based  on  it, 
cannot  with  safety  to  management  or  men  be  left  in  the  hands  of 
staff  experts.  The  workers  should  be  consulted  since  they  know 
the  job  in  a  way  that  no  one  else  can.  Moreover,  until  they  are 
prepared  to  accept  any  new  terms  or  new  standard  practice,  the 
work  of  the  experts  is  of  little  use  anyway.  Their  assent  is  in 
the  last  analysis  the  essential  prerequisite  to  manufacturing. 
Hence  consultation  with  those  at  a  job  is  recurrently  necessary  as 
orders  change,  improvements  are  suggested  and  processes  modi- 
fied. Only  so  can  an  assent  be  secured  which  is  ungrudging  and 
reasonably  acquiescent.  This  consultation  should  therefore  be 
so  carried  on  as  to  include  as  many  workers  as  possible — to  make 
each  worker,  as  one  writer  has  happily  expressed  it,  an  efficiency 
engineer.  Success  in  this  attempt  means  the  creation  of  inter- 
est of  the  most  genuine  sort,  since  attention  is  being  paid  inten- 
sively to  the  job  in  hand. 

This  interest  can  be  even  more  deeply  stirred  if,  in  addition  to 
agreement  upon  the  terms  of  work  as  determined  by  job  analysis, 
there  is  a  constant  mutual  effort  to  improve  the  technique  of 
work. 

The  latent  inventive  power  of  each  shop  can  be  helpfully 
challenged  in  a  way  to  arouse  a  really  scientific  interest  in  method, 
if  only  the  organization  exists  among  the  workers  through  which 
to  work.  One  of  the  most  suggestive  services  of  Mr.  Leitch's 
"Man  to  Man,"  is  the  account  he  gives  of  the  active  interest 
the  workers  take  in  process  as  soon  as  they  have  problems  put 
to  them  in  their  organized  capacity  and  have  a  stake  in  the 
improved  results.1  One  of  his  illustrations  has  been  interestingly 
summarized  in  the  following  paragraph : 

"A  large  manufacturer  of  velvets  was  having  trouble  with  'seconds'; 
at  times  half  a  million  dollars  was  tied  up  in  goods  that  contained  weav- 
ing defects  unfitting  them  for  first  grade  sale.  He  put  the  question  up 
to  the  employees  themselves — they  were  organized  on  the  representa- 
tive system.  The  men  appointed  committees  to  investigate,  they  made 
tests  themselves  and  they  retained  experts  from  the  outside  to  make 
other  tests.  They,  from  time  to  time,  told  of  their  work  in  mass  meet- 
ings and  received  criticisms  and  suggestions.  Soon  that  whole  factory 
was  after  'seconds';  they  improved  machinery,  insisted  on  cleanliness 

1  See  LEITCH,  JOHN,  Man  to  Man,  pp.  48-62,  67-91. 


212  PERSONNEL  ADMINISTRATION 

and  finally  changed  the  weavers  from  a  quantity  rate  to  a  quality.  They 
have  now  all  but  cut  out 'seconds'  and  under  the  quality  rate  the  weavers 
are  not  only  making  more  money  than  before,  but  they  say  they  are 
making  it  with  less  effort  than  when  they  tried  solely  for  quantity. 
But  the  quantity  has  also  increased.  I  have  through  my  business 
associates  secured  very  similar  results  by  the  use  of  similar  methods  in 
a  plant  making  linoleum."1 

But  workers'  advices  and  cooperative  job  study  are  likely  to 
lead  to  demands  for  drastic  changes.  And  the  adoption  of  im- 
portant technical  changes  including  further  application  of  labor 
saving  machinery  will,  sooner  or  later,  mean  that  fewer  workers 
can  do  the  necessary  amount  of  work.  Unquestionably  one 
of  the  reasons  why  there  has  not  been  greater  working  class 
interest  in  technical  improvement,  has  been  the  fear  of  this  dis- 
placement in  favor  of  machinery. 

It  is  because  we  conceive  of  this  function  of  job  analysis  and  of 
agreement  on  fair  amounts  of  work  in  relation  to  its  finds,  as  a 
joint  task  of  management  and  men  at  each  job  that  we  are  less 
disposed  than  some  to  stress  the  unique  value  of  a  wholly  sepa- 
rate suggestion  system.  In  the  normal  course  of  joint  job 
analyses,  joint  determination  of  a  fair  day's  work  and  joint 
agreement  to  technical  improvement,  suggestions  would  natu- 
rally and  normally  arise,  be  considered,  adopted  and  rewarded 
under  joint  direction.  Hence  the  need  of  a  distinct  system  would 
not  be  pressing.  But  because  many  plants  have  not  yet  come 
to  see  that  the  real  function  of  committees  is  constructive  and 
preventive  rather  than  mediatory  and  conciliative,  we  shall  con- 
sider suggestion  systems  as  a  means  of  arousing  interest. 

A  final  word  is  necessary  here,  however,  to  prevent  possible 
misunderstanding.  Shop  committee  action  may  conceivably 
result  in  two  things;  in  arousing  interest  in  process  through 
discussion,  conference,  study  of  records,  etc.;*  or  in  arousing 
interest  in  discussion  because  it  is  easier  to  talk  than  to  do  the 
job.  Critics  of  the  committee  idea  are  fond  of  urging  that  the 
second  of  these  results  will  be  the  one  obtained.  The  answer 
is  that  if  the  committee  work  is  undertaken  with  an  educational 

1  BASSETT,  WM.  R.,  When  The  Workmen  Help  You  Manage,  p.  113. 

*  The  Western  Efficiency  Society  finds  in  answer  to  a  questionnaire  that 
55  per  cent,  of  plants  which  have  shop  committee  plans  (of  any  sort,  not 
necessarily  meeting  to  discuss  production)  report  that  these  have  "stimu- 
lated production." 


AROUSING  INTEREST  IN  WORK  213 

motive  and  under  educational  direction,  there  need  be  no  fear  of 
the  results.  And  existing  efforts  to  interest  workers  through 
group  action  tend  effectually  to  prove  that  the  positive  results 
are  exceedingly  beneficial. 

Transfer  and  Promotion. — As  a  purely  business  proposition, 
managers  should  do  far  more  than  is  now  thought  wise,  to 
encourage  transfer,  as  one  method  of  relieving  the  worker  at 
automatic  operations.  The  use  of  the  morning  for  one  job  and 
the  afternoon  for  another  has  already  been  mentioned.  Other 
aspects  of  transfer  have  been  discussed  previously  and  we  men- 
tion it  here  only  to  indicate  that  jobs  which  may  be  self-expressive 
and  interesting  to  master  at  the  outset,  may  after  six  months 
or  a  year  become  completely  uninteresting;  just  as  jobs  which 
will  be  tolerable  for  five  or  six  hours  may  be  maddeningly  dull 
for  ten  or  twelve. 

We  are  in  this  proposal  simply  capitalizing  the  dictum  about 
variety  and  the  spice  of  life;  and  there  is  growing  agreement 
among  employment  administrators  that  such  variety  can  be 
found  in  transfer — found  to  the  advantage  of  the  employer  in 
greater  volume  in  output  and  of  the  employe  in  greater  interest 
in  work  itself.  The  possibilities  of  periodic  transfer  in  this 
direction  are  all  but  untouched  and  since  it  offers  a  genuinely 
and  mutually  valuable  psychological  stimulus  if  administered 
properly,  it  is  to  be  hoped  that  the  extension  of  its  use  will  be 
rapid  in  the  immediate  future. 

The  same  is  to  be  urged  regarding  promotion, — although  we 
have  to  stick  closely  to  the  facts  and  remember  that  the  number 
of  places  in  the  executive  staff,  or  at  the  operations  requiring 
most  skill  and  training,  are  always  limited;  and  that  the 
proportion  of  managed  to  managers  is  from  this  point  of  view 
discouragingly  large.  Promotion  to  executive  positions  can 
thus  only  be  of  occasional  help  in  meeting  this  problem;  but 
there  is  every  reason  to  use  it  to  the  limit.  However,  in  the 
advancement  from  one  position  to  another,  a  hierarchy  of  achieve- 
ment in  the  shop  can  often  be  worked  out.  And  while  a  job 
may  soon  cease  to  offer  large  possibilities  of  itself,  it  will  not  be- 
come completely  uninteresting  if  it  is  known  to  be  the  stepping 
stone  to  another  after  a  stipulated  time.  It  is  the  common 
experience  in  all  types  of  work  that  if  the  worker  has  his  eye  on 
some  goal  which  he  is  intent  upon  reaching,  his  job  becomes  for 
a  time  less  irksome  and  more  significant. 


214  PERSONNEL  ADMINISTRATION 

Maximum  Introduction  of  Machinery. — It  may  seem  odd  that 
we  should  suggest  that  additional  machinery  can  make  work 
more  interesting.  There  are,  however,  industries  and  factories 
in  which  the  amount  of  hard,  disagreeable,  physical  drudgery 
is  still  considerable.  There  are  plants  where  men  by  operating 
machines  can  do  more  and  better  work  than  by  hand,  do  it 
more  easily,  and  must  in  order  to  secure  quality  take  a  real 
interest  in  the  work  as  it  goes  through  the  process  and  in  the 
machine  which  does  the  work.  Other  things  being  equal,  it  is  to 
everybody's  interest  to  have  the  best  known  machinery  installed 
at  every  operation.  And  if,  as  is  possible,  this  means  an  in- 
crease in  the  number  of  simple  machine-feeding  jobs,  we  must 
seek  elsewhere  for  self-expression,  knowing  that  with  less  labor 
far  more  goods  are  being  supplied. 

Shorter  Hours. — One  way  we  can  meet  a  condition  where 
workers  find  work  monotonous  is  to  shorten  hours,  especially 
at  the  highly  repetitive  operations.  The  forty-four  and  forty 
hour  week  already  exist  in  certain  trades,  but  it  remains  for 
society  to  use  real  discrimination  and  apply  the  shortest  hours 
first  to  that  labor  which  is  either  most  arduous  or  most  monot- 
onous. What  can  serve  the  same  purpose  is  to  have  two  different 
jobs,  or  operations, — one  in  the  morning,  the  other  in  the 
afternoon. 

In  rural  industrial  centers  many  workers  of  their  own  accord 
elect  to  do  factory  work  in  winter  and  agricultural  work  in  sum- 
mer— a  division  of  labor  for  which  there  is  much  to  be  said. 
Indeed,  we  may  in  some  not  too  distant  future,  de-urbanize 
our  factories  to  an  extent  that  more  and  more  workers  can  com- 
bine indoor  and  outdoor  work.  This  is  the  serious  proposal  of 
not  a  few  social  scientists. 

Nor  should  we  forget  in  this  connection  the  English  proposal1 
that  the  factory  operate  twelve  hours  in  two  shifts  of  six  hours 
each. 

This  advocacy  of  shorter  hours  as  a  way  to  relieve  monotony 
is  by  no  means  hi  conflict  with  our  thesis  that  much  work  can  be 
made  interesting.  But  we  may  as  well  be  honest  with  the  facts 
and  admit  that  as  we  know  them  now  many  factory  processes  carried 
on  for  a  nine  or  even  an  eight  hour  day  are  not  educational  or 
interesting.  With  shorter  hours,  however,  the  inherent  and 
derived  interests  here  enumerated  would  combine  to  give  the 

>  See  Chapter  VII. 


AROUSING  INTEREST  IN  WORK  215 

worker  the  maximum  satisfaction  in  work ;  and  even  at  seemingly 
quite  automatic  jobs  the  curve  of  interest  would  not  have  time 
to  fall  to  zero. 

Suggestion  Systems. — The  experience  of  the  last  few  years  in 
which  the  use  of  suggestion  systems  has  extended  rapidly,  points 
to  a  number  of  general  practices  which  can  be  briefly  stated 
to  show  in  what  ways  they  best  foster  interest  in  work. 

It  is  first  necessary  to  remove  from  the  foreman's  mind  any  idea 
that  suggestions  from  his  department  reflect  upon  his  ability. 
Foremen  can  be  brought  not  to  oppose  but  actually  to  encourage 
the  working  of  the  system.  This  attidude  is  more  readily  assured 
in  some  plants  by  periodically  rewarding  the  foreman  from  whose 
department  the  largest  number  of  suggestions  have  been  re- 
ceived or  adopted. 

Fairness  in  the  administration  of  the  system  is  essential. 
Workers  will  feel  most  confident  that  there  is  fair  play  if  they 
have  equal  voice  with  the  company  in  determining  the  terms  on 
which  the  system  runs,  in  determining  which  ideas  shall  be  accepted 
and  how  much  reward  shall  be  given  in  each  case.  Such  joint 
action  of  itself  keeps  interest  alive,  especially  if,  as  is  desirable, 
some  members  of  the  suggestion  committee  rotate  every  six 
months.  This  has  the  further  indirect  value  of  educating  the 
committee  members  in  problems  of  process  and  technique. 

Employees  should  be  acquainted  with  the  terms  of  the  system, 
the  method  of  determining  acceptance,  and  of  evaluating  the  sug- 
gestions, etc.,  by  bulletins,  notices  in  company  papers  or  pay 
envelopes,  and  by  other  means  that  reach  all  employees  with  a 
reminder  at  occasional  intervals. 

Prizes  should  be  given  at  monthly  intervals  and  with  effective 
publicity.  Also  public  acknowledgment  should  be  made  at  the 
end  of  the  year  to  the  department  submitting  the  highest  number 
of  adopted  suggestions,  the  individual  submitting  the  largest 
number,  the  individual  submitting  the  most  valuable  sugges- 
tions, etc. 

The  problem  of  the  amount  of  the  compensation  for  accepted 
suggestions  is  not  always  easy  to  handle.  To  have  a  scheme 
of  only  arbitrary  flat  sums  may  at  times  be  quite  unfair  to  the 
employee.  We  say  this  with  full  appreciation  of  the  fact  that 
the  worker  in  any  valuable  invention  ip  usually  building  on  the 
company's  own  experience;  but  this  will,  of  course,  be  taken 
account  of  in  determining  the  reward.  On  the  other  hand,  if 


216  PERSONNEL  ADMINISTRATION 

employees  are  to  keep  up  their  interest  in  improvement,  they 
must  know  absolutely  that  this  interest  is  not  to  be  an  occasion 
for  exploitation.  Yet  it  is  difficult  before  trying  out  a  new  idea 
to  know  its  value.  Perhaps  a  combination  of  two  methods 
could  be  worked.  Each  suggestion  could  bs  rewarded  in  accor- 
dance with  an  agreed  scale  of  awards,  and  when  it  is  seen  that 
the  best  ones  are  saving  the  company  substantial  amounts 
(say,  after  six  months),  a  more  equitable  division  could  be  made. 
It  seems  to  us,  however,  that  if  the  workers  have  equal  voice 
with  the  management  in  the  matters  above  suggested,  there 
will  be  less  danger  of  employees  feeling  unfairly  treated. 

Where  the  new  idea  is  patentable  it  is  worth  while  for  the  man- 
agement further  to  protect  the  workers'  rights.  In  some  plants 
employees,  as  a  condition  of  employment,  have  to  sign  waivers 
of  any  rights  in  inventions  forthcoming  during  their  stay.  For 
reasons  growing  out  of  the  use  of  some  unique  trade  secret,  a 
few  companies  may  feel  themselves  justified  in  requiring  such  a 
waiver.  But  it  would  seem  ordinarily  to  discourage  inventive- 
ness from  the  start.  A  royalty  contract,  designed  to  cover  with 
fairness  to  all  parties  the  situation  where  an  employee  has  a 
patentable  device,  has  been  drawn  and  some  such  method  as 
this  is  to  be  preferred  to  the  waiver.1 

Again,  it  is  important  to  have  suggestions  collected  regularly 
from  the  designated  boxes  ip  each  department,  passed  upon 
promptly  (at  least  once  a  month)  and  employees  notified  as 
soon  as  action  is  taken.  Pains  should  be  taken  in  each  case  to 
explain  why  rejected  suggestions  are  not  utilized.  And  it  should 
not  be  required  that  accepted  suggestions  be  put  into  immediate 
practice  in  order  to  be  rewarded. 

Employees  should  have  the  right  of  appeal  to  the  committee 
if  unsatisfied  either  with  the  action  on  the  suggestion  or  with  the 
reward. 

Only  actual  manual  workers  should  be  eligible  for  awards 
under  the  system.  Executives  from  the  assistant  foreman  up  are 
supposed  to  be  looking  for  better  methods  as  a  part  of  their 
jobs. 

In  plants  where  little  is  done  in  other  ways  to  arouse  interest, 
the  suggestion  system  can  undoubtedly  afford  the  basis  for  a 

1  PILKINOTON,  R.  G.  Fair  Royalty  Contract  for  Employees.  (In 
Am.  Machinist,  v.  47,  pp.  1027-8,  Dec.  13,  1917;  v.  48,  pp.  363-4,  Feb.  28, 
1918.) 


AROUSING  INTEREST  IN  WORK  217 

healthy  start.  But  unless  there  is  considerable  follow-up  from 
the  office  of  the  employment  administrator  there  is  danger  that 
after  a  little  the  interest  will  lag.  For,  after  all,  the  method  of 
dropping  your  suggestion  in  a  slot  is  singularly  impersonal  and 
artificial;  some  method  more  direct,  natural,  humanly  responsive 
and  more  organically  connected  with  the  technical  job  study  is 
ultimately  desirable. 

Factory  Fellowship. — An  indirect  interest  in  work  is  un- 
questionably afforded  by  the  pleasant  fact  of  fellowship  with 
other  workers.  This  is  not  the  same  thing  as  being  interested 
in  the  work  itself;  it  is  what  we  may  speak  of  as  a  derived  interest. 
It  has,  however,  a  positive  value  which  can  legitimately  be 
utilized.  People  of  both  sexes  and  all  ages  like  to  be  in  agreeable 
association  with  those  whom  they  know  and  like.  A  social 
life  inevitably  grows  up  in  a  factory  which  has  its  own  gossip, 
traditions,  jokes  and  by-words.  The  work  may  be  completely 
without  interest,  but  still  workers  like  to  be  there  in  order  to 
be  in  the  swim  of  the  familiar  social  life.  And  since  the  condi- 
tion of  being  there  is  to  do  the  work — the  work  gets  done. 

When  factories  accentuate  this  normal  camaraderie  by  encourag- 
ing athletics,  dances,  dramatics  and  other  recreational  functions, 
a  desire  to  remain  employed  may  be  unduly  stimulated.  Em- 
phatically, this  is  not  interest  in  work  although  it  may  be  used 
to  lead  to  it;  and  where  the  work  itself  seems  irrecoverably 
uninteresting,  it  may  be  one  of  the  next  best  substitutes  if  it  is 
not  over-developed.  Fellowship  for  its  pwn  sake  is  no  doubt  a 
good  thing  to  foster;  and  it  may  be  a  necessary  thing  to  foster 
to  make  the  work  tolerable.  But  with  this  the  more  direct 
methods  of  creating  interest  in  work  should  be  utilized. 

There  is  another  aspect  to  the  fellowship  feeling,  however. 
The  committee  action,  above  mentioned,  is  an  experience  of 
fellowship;  the  whole  enterprise  of  working  in  a  factory  is  an 
experience  of  fellowship — of  cooperative  action  and  associated 
effort.  And  psychologically  it  is  true  that  all  activity  in  satis- 
faction of  this  strong  social  sense  (herd  instinct)  is  pleasurable 
activity  up  to  a  certain  point.  So  that  there  is  also  a  real  and 
normal  interest  growing  out  of  the  fact  of  working  with  others.1 

Rhythm. — One  of  the  almost  wholly  unexplored  fields  of  in- 
dustrial psychology  relates  to  the  use  of  rhythm  and  music  to 
make  work  more  interesting. 

1  See  MAROT,  HELEN.     The  Creative  Impulse  in  Industry,  pp.  108-46. 


218  PERSONNEL  ADMINISTRATION 

The  conscious  mental  content  of  the  job  is  of  course  unaltered 
by  the  use  of  rhythmical  activity.  But  fundamentally  its 
self -expressive  content  is  altered  because  to  the  normal  individual 
the  utilization  of  rhythmic  motions  is  of  itself  pleasurable.  Ap- 
parently a  love  of  rhythm  is  one  of  the  most  deep-seated  of  human 
tendencies.  Its  use  for  any  activity  releases  unexpected  energies 
and  sustains  them  for  unexpectedly  long  periods.  It  tends  not 
only  to  reduce  the  feeling  of  fatigue  but  the  actual  physiological 
processes  of  fatigue  as  well.  Evidence  is  not  lacking  that  work 
done  rhythmically  is  done  with  less  conscious  effort  than  when 
rhythm  is  absent.  And  the  utilization  of  rhythmic  motion  or 
actual  music  itself,  seems  to  have  recuperative  value  from  a 
physiological  point  of  view.  It  may  not  be  accurate  to  say  that 
music  increases  interest  in  the  job;  but  it  certainly  makes  being 
at  the  job  more  interesting,  especially  if  the  motions  of  the  job 
can  be  rhythmically  performed.  It  is  to  this  extent  another 
derived  interest. 

In  consequence,  at  those  jobs  where  the  noise  of  machinery 
is  not  too  great,  the  occasional  use  of  music — either  as  rendered 
by  phonographs  or  by  the  workers  themselves  in  shop  singing — 
can  be  a  positive  benefit  to  the  workers  and  to  the  output.  This 
is  recognized  by  many  plants  to  the  extent  of  having  dancing 
at  rest  periods  and  lunch  hours,  and  band  concerts  in  lunch  rooms 
and  assembly  rooms.  But  this  is  not  the  same  thing  as  encour- 
aging mass  singing  at  work  or  providing  music  to  the  rhythm 
of  which  operations  cap  be  carried  on.  There  is  a  fruitful  field 
for  experimentation  here.  The  injunction  of  the  philosopher, 
Give  me  the  man  who  sings  at  his  work,  may  still  be  recovered  for 
fruitful  application  today. 

Wages. — It  goes  without  saying  that  unless  wages  are  at  least 
enough  to  provide  a  decent  standard  of  living  without  anxiety, 
there  cannot  be  interest  in  the  work.  But  the  claim  that  the 
sole  motive  in  working  is  the  pay  envelope,  must  seem  to  be 
an  unwarranted  over-simplification  after  what  has  been  said. 
The  motive  to  possession  and  to  increased  rewards  is  an  important 
one.  But  we  must  get  away  from  this  idea  that  the  workers  care 
only  about  the  pay  envelope.  The  impulses  to  create  and  con- 
struct and  to  satisfy  one's  curiosity,  one's  desire  for  the  approval 
of  others,  one's  sense  of  significance,  are  all  legitimate  parts  of 
the  human  equipment  and  demand  satisfaction.  Industry  has 
worked  too  long  in  the  belief  that  all  the  workers  want  is  wages. 


AROUSING  INTEREST  IN  WORK  219 

The  thing  to  do  now  is  to  supply  an  incentive  in  the  work  itself, 
as  well  as  in  the  rewards  accruing  out  of  the  work.  Admittedly 
the  non-financial  incentives  so-called,  might  be  used  to  exploit 
the  workers.  But  any  discussion  of  the  methods  of  interesting 
workers  presupposes  that  the  management  has  a  disposition  to 
treat  the  payment  problem  fairly. 

r-  The  Ownership  and  Control  of  Industry. — It  is  important  to  re- 
member that  when  all  is  said  and  done  the  determination  of  when 
a  factory  is  to  run  and  how  its  earnings  are  to  be  distributed  is  in 
the  hands  of  the  people  who  own  the  factory.  And  our  whole 
system  and  the  interest  that  the  workers  can  take  in  it,  is  natu- 
rally modified  in  a  fundamental  way  by  this  fact  that  the  owner- 
ship is  vested  in  absentee  or  manager  stock-holders  and  that 
ultimately  decision  about  returns  from  the  industry  is  vested 
there  also. 

In  a  recent  article  on  the  "Laborer's  Turn"  is  this  arresting 
sentence : 

"It  is  vain  to  expect  labor  to  respond  to  the  requirements  of  an  inten- 
sified production  so  long  as  industry  is  organized  on  a  basis  of  master 
and  man,  with  the  master  class  draining  away  those  elements  in  the 
working  population  who  are  most  needed  to  leaven  the  mass,  to  endow 
it  with  a  spirit  of  self-conscious  creativeness."1 

Another  carefully  phrased  sentence  of   similar  content  says: 

"Even  the  most  enlightened  labor  policy  cannot  eliminate  the  con- 
flict of  labor  and  capital  generally,  because  it  cannot  eradicate  the  dif- 
ference of  interest  which  exists  in  the  very  nature  of  things  between 
capital  and  labor  due  to  the  fact  that  capital  is  a  buyer  and  labor  a 
seller."2 

And  one  of  the  most  acute  students  of  the  American  industrial 
system,  makes  the  following  observation: 

"A  business  control  of  the  rate  and  volume  of  output  is  indispensable 
for  keeping  up  a  profitable  market,  and  a  profitable  market  is  the  first 
and  unremitting  condition  of  prosperity  in  any  community  whose  in- 
dustry is  owned  and  managed  by  business  men.  And  the  ways  and 
means  of  this  necessary  control  of  the  output  of  industry  are  always  and 
necessarily  something  in  the  nature  of  sabotage — something  in  the  way 
of  retardation,  restriction,  withdrawal,  unemployment  of  plant  and 
workmen — whereby  production  is  kept  short  of  productive  capacity. 

1  JOHNSON,  ALVIN.     Laborer's  Turn.     (In  New  Republic,  v.  10,  pp.  183-5, 
June  7,  1919.) 

2  SLIGHTER,  SUMNER  H.     The  Turnover  of  Factory  Labor,  p.  422. 


220  PERSONNEL  ADMINISTRATION 

The  mechanical  industry  of  the  new  order  is  inordinately  productive. 
So  the  rate  and  volume  of  output  have  to  be  regulated  with  a  view  to 
what  the  traffic  will  bear — that  is  to  say,  what  will  yield  the  largest  net 
return  in  terms  of  price  to  the  business  men  in  charge  of  the  country's 
industrial  system."1 

Whatever  truth  there  may  be  in  such  statements  as  these 
deserves  to  be  carefully  considered;  for  there  will  certainly  not 
be  interest  in  the  work  in  the  deepest  sense,  if  the  self-expressive 
activity  of  the  worker  is  found  upon  analysis  to  be  more  expressive 
of  the  will  of  some  employer  or  banker,  or  of  the  urgency  of  the 
demand  to  earn  a  livelihood,  than  expressive  of  the  inner  creative 
impulse  of  the  man  himself.  We  may  at  once  appear  open  to 
the  charge  of  utopianism  if  we  draw  the  conclusion  that  the 
psychological  conditions  of  interest  are  most  completely  met 
where  the  manual  workers  join  in  some  way  with  the  head 
workers  in  undertaking  the  direction  and  control  of  the  plant. 
But  as  students  we  cannot  hesitate  to  follow  where  the  argu- 
ment leads. 

^The  real  crux  of  the  problem  is  less  factory  control,  however, 
than  the  control  of  ownership  and  distribution?)  Ownership 
today  means  control  of  the  credits  needed  to  buna  and  extend 
equipment,  purchase  material  and  build  up  sales.  Credits, 
we  know,  are  granted  under  conditions  where  a  return  on  the 
investment  is  fairly  well  assured.  Practically  speaking,  the 

•  inala^Mii     iln     ••!     fni^ir     nr-'"*-^  '  ———!—£— — __iJ— — l^-il— _^^~    ............ .1.  ^ . 

^     ttii7*x    J  ^*     v«i.vy    vmr>    \\^  ^^^. 

But  they  might,  and  in  some  cases  do  upon  consideration,  feel 
that  they  are  asked  to  interest  themselves  in  an  enterprise  from 
which,  while  they  may  get  a  living  (not  regularly  assured  at  that) , 
those  who  have  extended  the  credit  get  proportionately  a  larger 
and  a  more  permanent  return.  This  thought  that  while  they  get 
wages  for  work,  others  get  income  for  ownership  of  the  premises 
and  equipment,  will  in  the  course  of  time  give  rise  to  a  feeling 
of  injustice.  Such  a  feeling  is  fatal  to  a  sense  of  real  interest. 
People  with  genuine  self-respect  are  loath  to  become  absorbed  in 
a  job  out  of  which  they  are  exploited — even  if  there  are  elements  in 
the  job  itself  which  arouse  interest.  A  sense  of  equal  and  genuine 
partnership  is  only  another  name  for  one  aspect  of  truly  Kelf- 
expressive  activity — activity  which  expresses  the  impulse  to  be 
and  work  with  others  for  tin-  common  advantage. 
w  Interesting  light  upon  this  point  of  view  is  offered  in  a  letter 
1  VEBI.KN,  THORSTEIN.  On  the  Nature  :tinl  l'>«-s  <>f  S:il.otHgcf  The  Dial, 
v.  60,  pp.  341-6,  April  5,  1919. 


AROUSING  INTEREST  IN  WORK  221 

sent  from  Hungary  early  in  1919  by  a  careful  and  conscientious 
observer : 

"I  visited  a  great  factory  at  Budapest  which  makes  electric  lamps, 
telephones  and  telegraphic  apparatus.  The  soviet  (i.e.,  directive  com- 
mittee) consisted  of  three  scientific  and  four  manual  workers.  The 
manager  was  a  former  engineer  of  the  works,  a  man,  obviously,  of 
ability  and  good  sense.  Three  former  directors  were  employed  as  con- 
sultative experts.  All  the  infinitely  skilful  work  of  this  vast  organism 
went  on  as  before,  with  this  difference,  however,  on  which  workmen  and 
managers  both  insisted,  that  men  and  women  alike  worked  with  more 
spirit,  more  conscience,  more  honesty  because  they  felt  that  they  were  work- 
ing for  themselves,  and  no  longer  for  an  exploiter.  The  Taylor  System 
will  shortly  be  introduced."1  ~J)  /  d-  >i  ^  f  *•/•<»  r-/r. 

The  reference  in  this  quotation  to  the  Taylor  system  is  iden- 
tical in  effect  with  the  discussion  by  a  Russian  socialist  leader 
of  the  change  in  point  of  view  which  should  come  with  the  as- 
sumption of  industrial  control  by  what  he  calls  " Soviets."  "We 
should,"  he  says,  "immediately  introduce  piece  work  and  try 
it  out  in  practice.  We  should  try  out  every  scientific  and  pro- 
gressive suggestion  of  the  Taylor  system." 

Work  as  Public  Service. — Under  modern  conditions  of  world- 
wide interdependence  workers  have  a  right  to  appreciate  two 
truths;  first,  tbat  they  are  servants  of  mankind — self-respecting 
contributors  to  the  world's  stock  of  necessary  goods,  receiving 
their  quota  (although  perhaps  not  their  rightful  one)  of  necessities 
and  luxuries  in  return  for  their  own  contribution;  and  second,  that 
the  world  of  consumers  must  put  its  faith  in  the  integrity  of  their 
workmanship — a  faith  which  would  cost  the  community  many 
lives  if  the  workers  were  to  betray  it. 

The  worker  in  food  products  must  not  contaminate  them  nor 
make  ptomaine  poisoning  possible.  The  workers  employed  in 
any  branch  of  the  transportation  industries — from  the  running  of 
locomotives  to  the  making  of  automobile  springs — may  literally 
endanger  thousands  of  lives  by  careless  workmanship.2  In  every 

1  BRAILSFORD,   H.   N.     In  Communistic   Hungary.     (In  New  Republic, 
v.  19,  pp.  119-23,  May  24,  1919.)     Italics  ours. 

2  Think,  for  example,  of  the  educational  value  of  showing  men  making  steel 
rails,  the  flaws  in  a  rail  which  has  caused  a  serious  wreck.     One  firm  manu- 
facturing  batteries  for    submarines    during    the  war  chose  only  girls  for 
assembling  work  who  had  relatives  in  the  war;  and  these  girls  were  in- 
structed carefully  as  to  the  use  to  which  those  batteries  were  to  be  put. 
Another  firm  which  manufactures  automobile  tires,  replaces  all  defective 
casings  and  turns  the  defective  goods  over  to  the  foreman  of  the  tire  building 
department  to  study. 


222  PERSONNEL  ADMINISTRATION 

direction  we  are  called  upon  to  put  absolute  trust  in  the  accuracy 
and  quality  of  work  done;  every  worker  in  so  far  as  this  spirit 
of  social  service  is  present,  is  thus  really  upon  his  honor  to  do 
good  work.  Many  workers  have  never  seen  the  importance  of 
their  work  in  this  light;  it  has  never  been  dramatized  to  them; 
their  honor  has  never  been  appealed  to;  and  one  of  the  highest 
and  most  cogent  motives  to  good  work  is  consequently  absent. 

The  objection  will,  of  course,  be  raised  that  it  is  out  of  the  ques- 
tion to  instill  into  manual  workers  this  conception  of  industry  as 
social  service  and  of  keeping  faith  with  the  consumer,  if  the  em- 
ployer himself  is  remiss  in  these  directions.  We  see  no  answer 
to  this  objection  in  those  cases  where  motives  are  narrowly  selfish 
and  methods  of  manufacture  or  sale  unscrupulous.  Those  em- 
ployers who  have  unwisely  sowed  the  wind,  reap  the  whirlwind; 
and  society  is  the  sufferer. 

But  it  is  happily  true  that  a  newer  conception  of  the  purpose 
and  the  ethical  obligations  of  industry  is  gaining  headway  among 
employers;  and  as  fast  as  it  comes  and  eventuates  into  practical 
conduct  which  society  including  the  workers  believes  to  be  more 
just,  the  workers  can  be  appealed  to  and  they  will  respond.  In 
the  last  analysis  there  is  no  appeal  which  stirs  such  deep  and 
lasting  interest  as  the  appeal  to  honorable  and  honest  service  in 
behalf  of  one's  fellows.  In  that  day  when  industry  is  run  not 
incidentally  to  meet  people's  known  needs,  but  avowedly  or- 
ganized to  that  end,  we  shall  have  a  motive  to  good  work  which 
is  now  all  but  untapped. 

The  recent  declarations  of  the  British  Labor  Party  confirms 
this  conclusion  from  an  interesting  angle: 

"What  the  Labor  Party  looks  to  is  genuinely  scientific  reorganization 
of  the  nation's  industry,  no  longer  deflected  by  individual  profiteering, 
on  the  basis  of  the  common  ownership  of  the  means  of  production,  the 
equitable  sharing  of  the  proceeds  among  all  who  participate  in  any 
capacity  and  only  among  these,  and  the  adoption  in  particular  trades 
and  occupations  .of  those  systems  and  methods  of  administration  and 
control  that  may  be  found,  in  practice,  best  to  promote  the  public 
interest."1 

Mr.  Cyrus  McCormick,  Jr.,  of  the  International  Harvester 
Company,  is  responsible  for  the  statement  that: 

1  Labor  and  The  New  Social  Order,  a  platform  submitted  for  the  con- 
sideration of  the  British  Labor  Party.  I*ublishud  in  The  New  Republic, 
v.  14,  sup.  pp.  1-12,  Feb.  16,  1918. 


AROUSING  INTEREST  IN  WORK  223 

"What  the  workingman  is  asking  for  .  .  is  a  voice  in  the  control 
of  business  in  which  he  is  a  co-partner.  This  demand  has  taken  on 
various  forms  in  various  countries.  In  Russia  and  elsewhere  on  the 
European  continent  it  is  known  as  Bolshevism;  in  England  they  call  it 
the  Whitley  Plan;  elsewhere  it  may  be  called  employees'  representa- 
tion .  .  Under  all  of  these,  it  is  the  basic  fact  that  the  relationships 
.- '.  must  be  founded  on  something  else  than  a  cash  bond  .  ." 

And  Mr.  Henry  L.  Gantt  writing  out  of  a  successful  consulting 
experience  of  over  twenty  years  has  come  finally  to  the  conclu- 
sion— expessed  in  italics —  that: 

"  We  have  proved  in  many  places  that  the  doctrine  of  service  which  has 
been  preached  in  the  churches  as  religion  is  not  only  good  economics 
and  eminently  practical,  but  because  of  the  increased  production  of 
goods  obtained  by  it,  promises  to  lead  us  safely  through  the  maze  of 
confusion  into  which  we  seem  to  be  headed,  and  to  give  us  that  indus- 
trial democracy  which  alone  can  afford  a  basis  for  industrial  peace."1 

Statements  like  these,  while  they  prove  nothing,  are  at  least 
indicative  of  a  point  of  view  toward  interest  in  work  which  is 
unquestionably  gaining  adherents.  It  is  a  point  of  view  which 
holds  that  workers  are  less  truly  interested  in  activities  under- 
taken for  private  profits  wherever  they  can  be  secured,  than 
by  public  service  wherever  it  is  demonstrated  that  human 
needs  are  present.  This  is,  of  course,  a  fundamental  criticism 
and  to  the  extent  that  experience  substantiates  it,  correction  will 
have  to  be  undertaken  by  society  as  a  whole  in  the  public  inter- 
est, and  not  solely  by  any  one  class  in  its  own  interest. 

Such  correction,  if  undertaken,  is  likely  to  be  long  in  coming; 
and  it  should  not  be  surprising  if  in  the  interval  of  transition,  the 
fostering  of  interest  in  work  is  not  completely  successful.  There 
is,  however,  no  adequate  reason  why  every  legitimate  expedient 
should  not  be  progressively  resorted  to,  for  high  productivity  is 
at  bottom  conditional  upon  interest  in  work.  And  upon  high 
productivity  the  community  as  a  whole  must  immediately  de- 
pend in  order  to  secure  a  comfortable  and  reasonably  cheap 
living.  The  community  can,  therefore,  afford  to  encourage  in- 
dustrial managers  to  go  to  great  lengths  to  stimulate  interest. 
And  if  some  modification  of  the  present  dominant  motive  of  pri- 
vate profits  seems  clearly  to  be  required,  consumers  as  a  whole 
should  be  the  first  to  clamor  for  it.  If  pressure  can  come  from 

1  GANTT,  HENRY  L.     Organizing  for  Work,  p.  104. 


224  PERSONNEL  ADMINISTRATION 

consumers  and  workers  simultaneously  there  will  be  some  hope 
that  industrial  changes  will  be  achieved  by  temperate,  democratic 
and  permanent  measures. 

We  can  most  pointedly  conclude  this  discussion  of  interest  by 
recalling  the  inseparable  relation  between  interest  and  efficiency. 
In  the  last  analysis  factory  efficiency  derives  from  a  combination 
of  perfected  mechanical  contrivances  and  arrangements,  scientific 
coordination  and  control  of  flow  of  work  and  an  attitude  of 
interest  and  initiative  on  the  part  of  all  the  workers.  This 
attitude  of  interest  and  initiative  is  not  in  the  long  run  bought, 
bribed  or  teased  out  of  workers.  It  flows  out  naturally  and 
necessarily  if  the  conditions  are  right.  All  that  anyone  can  do 
is  to  help  to  create  those  conditions,  bearing  in  mind  the  psycho- 
logical springs  of  interest. 

In  short,  efficiency  is  not  present  unless  there  exists  the  consent 
of  the  workers.  The  consent  of  the  workers  is  not  actually 
present  unless  it  is  an  active  and  voluntary  consent.  And  that 
attitude  of  willingness  and  of  desire  for  self-initiated  activity 
is  the  result  of  genuine  interest  in  the  enterprise  growing  out  of  a 
sense  of  partnership  in  its  conduct.  Hence  our  conclusion  that 
attention  to  the  securing  of  interest  is  an  immediate  duty  in  any 
factory  where  the  aim  is  efficiency  through  economical  operation 
and  cordial  working  relations. 

Selected  References 

BAKER,  N.  D.     Employees  Advisory  Plan  of  the  Arsenal?.     (In /fuhufrfal 

Management,  v.  58,  pp.  400-402,  Nov.,  1919.) 
BARSETT,    W.    R.     When    the    Workmen    Help    You    Manage.     N.   Y., 

Century  Co.,  1919. 
HKANDKIS.  L.  D.     Efficiency  by  Consent.     (In  Industrial  Management,  v. 

65,  pp.  108-109,  Feb.,  1918.) 
COL.VIN,  F.  H.     Labor  Turnover,  Loyalty  and  Output.    N.  Y.  McGraw-Hill, 

Book    Company,    1919.     Ch.  II:  Building  an  Organization,  pp.  1.'   jl  ; 
Ch.  IV:  Securing  Interest  by  Instruction,  pp.  44-00. 

DKWEY,  JOHN.     Interest  and  Discipline.     (In  his  Democracy  and  Educa- 
tion. 1919,  pp.  146-102.) 
DKWEY,  JOHN.     Interest   and    Effort  in   Education.     N.   Y.,    Houghton, 

MifTlin  Co.,  1913. 
GANTT,   H.  L.     Organizing  for  Work.     N.  Y.,  Harcourt,  Brace  &  Howe, 

1919. 
JOHNSON,  A.  8.     Laborer's  Turn.     (In  New  Republic,  v.  19,  pp.  183-18,r>, 

June  7,  1919.) 
LEITTH,    JOHN.     Man    to    Man;    the    Story    of    Industrial    Democracy. 

N.  Y.,  B.  C.  Forbes  Co.,  1910. 


AROUSING  INTEREST  IN  WORK  225 

LENINE,    NIKOLAI.     Soviets    at    Work.     N.    Y.,    Rand    School    of  Social 

Science,  1918.     See  also  What  Lenine  Said  About  the  Taylor  System. 

(In  Taylor  Society  Bull,  v.  4,  No.  3,  pp.  35-38,  June,  1919.) 
MAROT,  HELEN.     Creative  Impulse  in  Industry.     N.  Y.,  E.  P.  Dutton  & 

Co.,  1918.     pp.  108-146. 
TEAD,   ORDWAY.     Instinct  of  Workmanship.     (In  Instincts  in  Industry, 

1918,  pp.  44-66.) 
TEAD,    ORDWAY.     Trade  Unions  and  Efficiency.     (In  American  Journal  oj 

Sociology,  v.  22,  No.  1,  pp.  30-37,  July,  1916.) 
VALENTINE,  R.  G.     Human  Element  in  Production.     (In  American  Journal 

of  Sociology,  v.  22,  pp.  477-488,  Jan.,  1917.) 
VALENTINE,  R.  B.     Progressive  Relation  Between  Efficiency  and  Consent. 

(In  Society  to   Promote  Science   of   Management    (Taylor  Society), 

vol.  1,  No.  6,  pp.  26-30,  Nov.,  1915.) 
WOLF,  R.  B.     Control  and  Consent.     Discussion  of  Instructions,  Initiative 

in  Industry.     (In  Taylor  Society  Bui.,  v.  3,  No.  2,  pp.  5-20,  March, 

1917.) 
WOLF,    R.   B.     The    Creative    Workman.     N.  Y.,   Technical  Association 

of  Pulp  and  Paper  Industry,  1918. 
WOLF,  R.  B.     Individuality  in  Industry.     (In  Society  to  Promote  Science  of 

Management,  v.  1,  No.  4,  pp.  2-8,  August,  1915.) 
WOLF,  R.  B.     Making  Men  Like  Their  Jobs.     (In  System,  v.  35,  pp.  34- 

38,  222-226,  Jan.,  Feb.,  1919.) 
WOLF,  R.  B.    Securing  the  Initiative  of  the  Workman.     (In  U.  S.  Bureau  of 

Labor  Statistics,    Monthly  Labor  Review,  v.  8,  pp.  1684-1686,  June, 

1919.) 
WOLF,  R.  B.     Securing  the    Initiative  of  the  Workman.     (In  American 

Economic    Review,    v.    9,  sup.   pp.    120-121,    March,    1919.)     Also  in 

Survey,  v.  41,  pp.  620-625,  Feb.  1,   1919. 
WOLF,  R.  B.     Use  of  Non-Financial  Incentives  in  Industry.     (In  American 

Society  of  Mechanical  Engineers  Journal,  v.  40,  pp.  1035-1038,  Dec., 

1918.) 


t - 


15 


CHAPTER  XVI 
TRANSFER  AND  PROMOTION 

In  the  normal  individual,  interest  in  work  comes  from  a  sense 
of  the  work's  inherent  appeal,  of  its  significance  and  value  in  his 
life  and  progress,  of  the  approval  that  its  doing  wins  in  the  eyes 
of  others.  To  secure  that  interest  under  present  factory  condi- 
tions is  not  easy  without  the  special  planning  of  such  methods  as 
were  discussed  in  the  previous  chapter.  The  place  that  transfer 
and  promotion  may  hold  in  such  a  plan  is  large  because  both  are 
means  of  appealing  to  fundamental  characteristics  in  human 
nature.  Both  are  means  of  breaking  a  dull  routine;  of  holding 
out  promise  of  change  and  new  opportunity;  of  appealing  to  the 
individual's  pride  of  work,  mastery  or  desire  for  advancement. 

Transfer  we  may  define  as  a  shifting  of  workers  among  jobs 
requiring  approximately  equal  abilities,  for  the  purpose  of 
securing  a  better  adjustment  of  worker  to  work,  of  providing  a 
varied  outlet  for  his  energies  or  of  regularizing  his  employment  so 
as  to  supply  steady  work. 

Promotion  is  an  advancing  of  workers  to  new  positions  re- 
quiring greater  ability,  or  involving  greater  responsibilities  or 
commanding  higher  pay. 

Unfortunately  many  companies  are  still  unconvinced  that  there 
are  business  values  in  systematically  encouraging  transfer  and 
promotion.  They  may  even  feel  that  transfer  is  not  feasible  or 
desirable  and  that  workers  prefer  to  stay  at  one  job;  and  that 
promotion  need  not  be  considered  except  at  those  occasional 
times  when  an  executive  has  to  be  replaced  by  death.  It  is,  in 
short,  essential  that  a  company  have  a  sympathetic  attitude 
toward  the  desirability  of  a  defined  policy  on  these  two  matters. 
And  we  shall,  therefore,  consider  first  the  reasons  for  acting 
affirmatively  in  setting  up  a  procedure  in  these  two  fields. 

Reasons  for  Transfer. — There  are  good  business  reasons  for 
agreeing  upon  a  definite  transfer  policy.  The  desirability  of 
getting  a  spur  to  interest  by  holding  out  the  hope  of  leaving  one 
job  to  go  to  another  is  of  primary  value. 

226 


TRANSFER  AND  PROMOTION  227 

But  many  corporations  are  not  as  yet  sufficiently  flexible  to 
permit  any  very  systematic  rotation  in  work  positions.  They 
have  not  as  yet  generally  thought  of  transfer  as  a  method  of 
alleviating  narrow  specialization,  monotony  or  restlessness. 
They  have  not  availed  themselves  of  its  educational  value  in 
stimulating  interest  in  work,  increasing  skill  and  broadening 
knowledge.  As  a  result  men  are  tied  down  to  tasks  which  do  not 
call  forth  their  best  qualities  or  hold  any  vital  interest  for  the 
mentally  alert,  and  thus  a  plant's  labor  turnover  tends  to  increase 
in  spite  of  the  careful  examination  and  selection  of  workers  at 
the  time  of  entrance. 

Also,  wherever  initial  selections  have  been  unwisely  made, 
there  is  the  need  for  an  agreed  machinery  for  getting  the  workers 
adjusted  into  the  organization,  by  shifting  them  to  jobs  they 
can  do  well  or  really  like. 

There  may,  again,  be  "dead  end"  jobs  that  lead  nowhere  at 
which  it  is  unfair  to  hold  the  worker  either  because  the  work 
or  the  pay  offers  no  future. 

There  are  other  jobs  from  which  transfer  should  be  readily 
provided  on  health  grounds.  If  it  is  found  that  work  brings  on 
special  strains  or  predisposes  to  certain  diseases,  the  worker 
should  be  required  to  transfer. 

In  some  few  companies  the  employment  and  medical  depart- 
ments jointly  set  a  time  limit  on  jobs  where  there  is  likelihood 
of  occupational  disease — as  for  example,  in  sand  blasting,  curing 
hides,  rubber  manufacture,  or  in  contacts  with  and  exposure  to 
poisonous  materials.  At  the  close  of  this  time  limit  the  employee 
is  re-examined  physically  to  ascertain  if  transfer  is  necessary. 
In  an  extremely  noisy  department  of  a  large  rubber  concern 
workers  are  examined  at  frequent  intervals  and  those  showing 
slight  defects  in  hearing  are  transferred. 

Another  important  reason  for  transfer  may  be  lack  of  work  in 
the  department  where  the  worker  is  originally  placed — due  either 
to  a  slump  in  orders  or  to  seasonal  fluctuations.  In  such  cases 
the  desirability  of  providing  ways  to  keep  on  as  large  a  body  of 
trained  workers  as  possible  will  be  seen  at  once  by  the  personnel 
manager  who  under  the  old  method  had  to  build  up  the  force 
afresh  each  season. 

There  are  occasionally  also  reasons  of  personal  maladjustment 
between  foremen  and  workers  or  among  a  group  of  workers, 
which  make  transfer  beneficial  to  shop  harmony.  Where  people 


228  PERSONNEL  ADMINISTRATION 

do  not  thus  "hit  it  off"  together,  there  is  every  advantage  in 
re-arranging  the  personnel  until  a  companionable  grouping  is 
secured.  Sometimes  these  personal  animosities  are  really 
racial  in  origin  and  in  such  cases  racial  prejudices  have  to  a 
large  extent  to  be  respected.  And  in  the  interests  of  shop 
tranquillity,  workers  whose  nationality  makes  them  offensive  to 
the  great  majority  of  their  fellows  may  have  to  be  transferred. 

Reasons  for  Promotion. — The  spur  to  individual  initiative 
which  comes  with  the  chance  for  advancement  in  earnings  and 
in  honors  is  proverbial.  It  is  a  spur  which,  if  the  advancement  is 
really  forthcoming,  is  of  great  and  legitimate  value.  For 
many  organizations  lose  a  considerable  degree  of  the  enthusiasm 
and  zeal  they  might  command  by  failing  to  make  it  apparent 
that  they  will  recognize  merit  and  advance  the  ambitious. 

Moreover,  promotion  from  within  means  a  conservation  of 
interest,  loyalty  and  knowledge  of  company  methods,  which  is  a 
real  asset.  Corporations  should  capitalize  the  experience  of 
their  own  people  by  using  them  for  the  higher  positions  wherever 
possible.  There  is,  we  agree,  the  danger  that  a  too  intensive 
program  of  promotion  from  within  will  lead  to  the  "inbreeding" 
and  "dry  rot "  of  an  organization.  But  that  danger  if  recognized 
in  advance  can  be  forestalled  by  the  right  kind  of  broadening 
educational  procedure. 

Prerequisites  of  Effective  Transfer  and  Promotion. — All 
systematic  plans  of  transfer  and  promotion  presuppose  that  the 
personnel  office  is  responsible  for  taking  the  initiative  in  carrying 
them  out.  In  the  production  departments  the  actual  order 
for  transfer  and  promotion  might  be  issued  by  the  production 
manager's  office,  but  it  would  come  largely  at  the  instance  of  and 
in  constant  cooperation  with  the  employment  office. 

This  indicates,  of  course,  the  necessity  of  careful  follow-up 
of  workers  by  the  employment  director,  in  order  to  be  sure  that 
they  are  properly  selected  for  their  work,  in  order  to  discuss  with 
foremen  candidates  for  promotion,  and  in  order  to  arrange 
transfers  in  accordance  with  a  prearranged  schedule.  It  should 
be  his  work  in  conference  with  instructors  and  foremen  to  rec- 
ommend all  shiftings  and  advances  in  those  departments  over 
whose  personnel  procedure  he  has  charge. 

All  work  of  adjusting  employees  into  the  most  suitable  posi- 
tions, all  planning  of  transfer  and  all  promotional  charts,  must 
be  based  on  intimate  knowledge  of  the  content  of  jobs  if  the 


TRANSFER  AND  PROMOTION  229 

results  are  to  be  scientifically  sound.  Job  analysis,  or  in  its 
absence  the  less  intensive  job  specifications,  are  needed  for  each 
position.  For  it  is  essential  to  know  the  precise  nature  of  the 
abilities  and  the  relative  amounts  of  ability  which  the  several 
jobs  require.  Job  specifications  throw,  also,  much  light  on  the 
similarity  of  jobs,  or  on  the  fact  that  similar  training  may  be 
utilized  at  widely  different  jobs. 

Methods  of  Transfer. — Some  firms,  in  order  to  place  the 
worker  from  time  to  time  in  best  relation  to  the  known  require- 
ments of  the  jobs,  seek  to  secure  on  the  new  workers'  application 
blank  all  possible  information  about  their  previous  work,  their 
special  talents  and  interests. 

From  the  point  of  view  of  offsetting  the  deadening  results  of 
machine  "minding,"  a  policy  of  transfer  requires  a  schedule  of 
maximum  time  limits  beyond  which  workers  are  not  kept  on 
jobs.  For  example,  a  factory,  after  study  of  the  operations  in 
its  departments,  might  plan  to  rotate  all  the  workers  at  certain 
jobs  with  not  more  than  a  six  months'  stay  at  any  one  of  them. 

Such  an  arrangement  should  of  course  be  administered  with  a 
good  deal  of  flexibility;  and  it  requires  some  readjustment  in 
the  mental  habits  of  executives  and  workers.  But  once  under 
way  its  stimulating  effect  on  all  is  tremendous.  For  one  thing, 
such  systematized  transfer  would  probably  require  more  ex- 
tensive as  well  as  perhaps  more  intensive  training.  The  policy 
of  requiring  new  workers  to  learn  several  operations  at  the  start 
is  in  line  with  this  suggestion;  indeed,  this  has  been  found  exceed- 
ingly helpful  in  plants  where  seasonal  fluctuations  make  it 
necessary  for  employees  to  work  in  several  departments  if  they 
are  to  secure  consecutive  employment. 

A  few  plants  have  developed  the  "flying  squadron"  idea 
among  their  manual  workers.  The  plan  here  is  to  select  a  group 
of  from  a  dozen  to  two  dozen  workers  who  have  worked  through 
the  several  processes  in  a  plant  and  demonstrated  their  versa- 
tility, and  make  them  a  team  which  can  be  turned  temporarily 
into  any  department  where  production  has  slumped.  Those  who 
train  for  and  those  who  are  selected  for  the  squadron  have  to  be 
carefully  transferred,  and  a  position  on  the  squadron  is  frequently 
regarded  as  a  promotion  in  honor  or  earnings  or  both. 

Workers'  Attitude  Toward  Transfer. — Managers  have  occa- 
sionally found  at  the  outset  that  workers  are  not  enthusiastic 
about  a  systematic  policy  of  transfer  as  an  offset  to  the  routine 


230  PERSONNEL  ADMINISTRATION 

character  of  their  work.  The  reasons  for  this  inertia  should  be 
apparent  and  they  should  not  be  allowed  to  act  too  seriously  as  a 
deterrent.  Indifference  to  transfer  may  be  due  to  lack  of  varied 
training,  knowledge  that  earnings  may  be  temporarily  reduced 
immediately  after  transfer,  general  fatigue  due  to  long  con- 
tinuance at  one  job  in  the  course  of  which  the  worker  has  lost 
his  resilience,  or  finally  to  a  mental  constitution  which  loves 
routine  and  hates  to  change  even  when  that  change  might  in  the 
long  run  benefit  the  individual.  All  but  perhaps  the  last  of  these 
causes  can  be  met  by  definite  action  in  one  direction  or  another. 

Particular  attention  must  be  paid,  however,  to  keeping  wages 
from  suffering  even  temporary  reduction.  And  while  some  mana- 
gers may  wonder  why  they  should  not  leave  alone  workers  who  have 
become  incapable  of  demanding  some  variety  of  work,  the  answer 
is  that  the  long  time  results  of  such  routineering  are  deadening 
to  initiative,  energy,  goodwill  and  interest.  Especially  with 
young  workers  are  the  values  of  their  now  enthusiasm  lost  if 
they  are  allowed  gradually  to  slip  into  the  idea  that  work  holds 
no  future  and  no  interest.  Despite  appearances,  therefore,  the 
manager  who  understands  human  nature  will  appeal  to  its  crea- 
tive side  by  encouraging  transfer  even  when  he  meets  with  actual 
opposition  in  its  introduction. 

Methods  of  Effecting  Promotion. — The  first  practical  step  in 
caring  properly  for  promotion  is  to  prepare  charts  carefully 
outlining  the  possible  successive  steps  in  advancement  which 
the  workers  in  each  department  may  take.  The  charts  should 
indicate  definite  lines  of  promotion  within  and  between  depart- 
ments, so  that  every  employee  can  see  what  opportunities  for 
responsibility  and  increased  reward  are  before  him  if  he  makes 
good;  and  can  find  out  what  special  training  he  requires  before 
he  can  advance. 

Ihese  opportunity  charts  should  be  based  on  detailed  job 
specifications,  since  in  order  to  grade  jobs  scientifically  it  is 
necessary  for  the  employment  department  to  know  the  content 
of  the  different  jobs  and  the  necessary  qualifications  of  the 
individual  workman.  A  graded  classification  of  occupations  for 
advancement  shows  the  worker  the  particular  relation  of  the 
job  he  occupies  to  the  one  next  in  line  for  which  he  may  qualify. 

Some  concerns  believe  it  good  policy  to  encourage  employees 
to  study  and  analyze  the  duties,  responsibilities  and  opportunities 
of  jobs  closely  related  to  their  own.  The  opportunity  to  advance 


TRANSFER  AND  PROMOTION  231 

from  one  position  to  the  next  logical  step  leading  ahead  is  made 
to  act  as  a  real  and  wholesome  motivation  to  good  work. 

The  charts  must,  of  course,  give  a  true  picture  of  the  situation; 
and  where  promotion  depends  rather  upon  special  training  and 
superior  ability  than  on  mere  length  and  faithfulness  of  service 
tnat  should  be  frankly  stated.  For  the  possibilities  of  advance- 
ment may  be  easily  overstated  and  false  hopes  be  unfairly  raised. 
And  it  is  just  as  bad  to  excite  unrealizable  ambitions  as  it  is  to 
offer  no  incentives  at  all. 

Promotion  as  a  general  policy  should,  therefore,  go  hand  in 
hand  with  definite  instruction  for  higher  positions.  Much  of  the 
elaborate  training  of  large  corporations  is  really  directed  to  the 
discovery  of  talent  for  promotion  and  the  cultivating  of  special 
abilities  where  they  are  found.  Eagerness  for  advancement  and 
youthful  ambition  are,  managers  should  remember,  no  substitutes 
for  real  knowledge  of  the  subject  matter  of  the  industry.  A  use- 
ful promotional  policy  presupposes  a  systematic  training  policy. 

But  even  with  a  training  procedure  elaborated  there  will  be 
much  lost  motion  if  some  care  is  not  taken  in  selecting  those  who 
are  to  profit  by  courses  and  special  training  for  promotion. 
Selection  for  executive  work  and  for  most  positions  of  increased 
responsibility  can,  in  the  light  of  modern  methods,  be  greatly 
improved  by  the  careful  use  of  special  tests.  And  the  application 
of  intelligence  tests  and  rating  scales  to  meet  this  need  should  be 
carefully  considered.1 

More  important,  however,  than  such  tests  in  most  cases  will 
be  actual  performance  records.  Full  records  of  individual  work 
and  progress  should,  therefore,  be  at  the  basis  of  selections  for 
advancement.  These  records  must  be  simple;  the  elements 
which  go  to  give  the  total  showing  should  be  known  to  workers; 
and  their  individual  standing  should  be  gone  over  with  them  from 
time  to  time  to  give  them  a  basis  for  their  own  special  efforts 
and  training. 

One  method  of  cultivating  the  training  idea  in  relation  to 
promotion  without  resort  to  formal  classes  is  the  so-called  "three- 
position  plan"  outlined  by  the  Gilbreths.     Under  this  plan  each  \s 
worker  is  conceived  as  belonging  to  three  groups.     He  is  arri 
instructor  in  the  group  of  workers  just  below  him  among  whom 
he  has  previously  been  a  worker;   he  is  a  worker  in  his  own 
group;  and  he  is  a  student  of  the  work  just  above  that  which 

*  See  Chapter  VI. 


232  PERSONNEL  ADMINISTRATION 

he  now  does.  As  an  actual  plan  of  action  in  any  plant  this  idea 
may  present  many  difficulties  and  be  quite  impractical.  But  as 
embodying  a  helpful  attitude  toward  promotion,  the  plan  is 
certainly  suggestive,  since  it  encourages  a  dynamic  view  of 
workers  and  of  jobs,  tends  to  give  the  worker  a  chance  to  pass 
on  to  those  who  supersede  him  at  a  job  the  best  in  his  own  work- 
ing methods,  and  tends  to  spur  him  to  new  interest  in  the  work 
of  his  superior. 

A  more  formal  training  procedure  in  preparation  for  promotion 
is  the  flying  squadron  idea  applied  to  executive  positions.  Under 
this  arrangement  as  used  in  a  number  of  large  plants  young  men 
are  scheduled  to  work  a  given  number  of  months  in  each  depart- 
ment, after  which  training  they  are  advanced  to  an  executive 
position  from  which  their  rise  depends  wholly  on  their  own 
demonstrated  ability. 

The  method  of  requiring  each  executive  to  train  and  have 
available  an  adequate  understudy  for  his  own  position  is  valuable 
as  offering  promotional  opportunity  and  as  sound  organization 
policy.  Foremen  and  factory  superintendents  especially  should 
be  required  to  select  and  keep  in  readiness  men  who  can  do  the 
bulk  of  their  work  whenever  they  must  be  away  and  who  can 
succeed  them  if  they  leave.  The  policy  of  understudying  execu- 
tives supplements  a  promotional  policy  in  many  helpful  ways. 

One  prominent  company  encourages  its  employees  to  fill  in  a 
"better  advantage  notice,"  realizing  that  some  among  itsmen  may 
be  working  out  of  their  regular  line  or  trade.  Every  employee 
is  asked  to  list  his  qualifications  for  other  jobs  than  the  one  he  is 
doing;  the  extent  of  his  previous  experience  in  other  work,  and 
his  estimate  of  what  he  would  like  to  do  or  can  do  better.  This 
notice  is  given  to  the  foreman,  who  may  transfer  or  advance 
the  employee  to  more  suitable  work  or  communicate  the  worker's 
desire  to  the  employment  department.  Among  the  drill  press 
operators,  for  instance,  the  company  found  a  Swiss  watchmaker 
for  whom  the  manager  thereafter  got  employment  at  his  own 
trade.  Again,  the  heat-treating  department  needed  an  expert 
fire-brick  layer,  and  found  such  a  man  running  a  drill  press. 
He  was  a  master  at  his  trade  of  fire-brick  construction,  and  the 
company  made  him  general  inspector  of  furnace  conditions  and 
repairs. 

Other  companies  issue  booklets  describing  the  opportunities 
at  the  several  positions  and  encouraging  workers  to  undertake 


TRANSFER  AND  PROMOTION  233 

special  study  for  them.  Other  companies  when  an  opening 
higher  up  occurs  post  notices  through  the  plant  asking  for 
applications. 

Promotion  to  Outside  Positions. — When  everything  possible 
has  been  done,  however,  to  open  up  promotional  chances,  many 
firms  will  have  more  aspirants  for  advancement  than  they  have 
positions.  In  such  situations  the  value  of  a  policy  of  promoting 
"up  and  out"  should  be  considered.  A  number  of  firms  have, 
for  example,  found  that  they  get  the  benefit  of  workers'  interest, 
energy  and  zeal  sufficiently  in  a  few  years  under  such  a  policy 
to  make  it  pay  them  to  help  their  workers  after  that  time  to  get 
higher  paid  positions  elsewhere.  And  especially  where  coopera- 
tive relations  can  be  established  among  the  employment  depart- 
ments of  a  number  of  firms  there  is  no  doubt  but  that  promotion 
"up  and  out"  can  be  both  practical,  profitable  to  all  concerned, 
and  a  spur  to  new  interest  in  work. 

Properly  conceived,  however,  this  promotion  or  any  other 
need  not  necessarily  be  in  terms  of  larger  earnings.  A  new  posi- 
tion with  more  varied  work  or  more  interesting  work,  with  greater 
responsibility  and  greater  prestige,  may  properly  offer  a  whole- 
some incentive — especially  among  salaried  workers  where  earn- 
ings are  well  above  a  subsistence  level.  In  the  shop,  on  the  other 
hand,  promotion  may  often  have  to  be  more  largely  in  terms  of 
higher  wages  than  of  a  change  in  work.  The  important  thing  is 
that  there  be  agreement  throughout  a  plant  as  to  what  changes  in 
work  or  pay  shall  be  esteemed  as  promotion;  and  that  then 
there  shall  be  some  organization  of  the  approval  of  fellow  workers 
for  those  who  do  secure  the  advance. 

The  Limits  to  Promotion. — There  is  in  most  organizations 
room  for  much  more  promotion  from  within  than  now  occurs. 
But  there  are  also  distinct  limits  to  the  promotional  oppor- 
tunities— whether  they  are  conceived  in  terms  of  work  or  of  pay, 
or  in  terms  of  "inside"  or  "outside."  For  the  organization  of 
work  in  a  modern  plant  strictly  limits  the  ratio  of  directive  to 
manual  workers.  It  is  probably  true  that  most  plants  would 
profit  by  a  somewhat  higher  ratio  of  supervisory  to  actual  labor 
than  is  now  typical.  One  foreman  to  forty  or  fifty  workers  may 
wisely  give  way  to  a  basis  of  one  foreman  to  every  twenty  or 
twenty-five — provided  we  think  of  the  foreman  not  as  a  task- 
master but  as  a  skilled  and  highly  scientific  supervisory  expert. 
But  even  so  there  is  not  room  "at  the  top"  for  all  "at  the  bot- 


234  PERSONNEL  ADMINISTRATION 

torn"  who  may  aspire  to  rise.  Of  course,  all  do  not  so  aspire; 
but  the  fact  remains  that  it  will  take  a  lot  of  hard  managerial 
thinking  and  reorganizing  to  make  workers  feel  that  there  really 
is  a  reasonable  chance  of  their  rising  to  the  positions  they  see 
above  them  for  which  they  are  either 'actually  or  potentially  fit. 

Where  seniority  is  the  basis  of  promotion  there  may  be  an 
artificial  limit  upon  the  advancement  of  young  men,  which  is 
detrimental.  The  object  sought  in  most  seniority  plans  is, 
however,  a  laudable  one.  They  usually  aim  to  assure  continuity 
of  employment  for  the  older  workers,  to  reward  their  faithfulness 
and  presumably  superior  ability  due  to  long  service,  and  to 
encourage  workers  to  remain  with  the  company.  These  ends 
can  usually,  however,  be  better  secured  in  some  other  way  than 
by  the  seniority  plan.  What  is  really  needed  in  most  corpora- 
tions that  use  this  basis  is  rather  an  adequate  pension  plan, 
definition  of  standards  of  "a  fair  day's  work,"  joint  determina- 
tion of  the  conditions  of  discharge  and  joint  recommendation  of 
the  candidates  for  promotion.  Other  things  beingequal,  seniority 
may  constitute  a  fair  basis  for  advance;  but  since  the  complicat- 
ing factors  are  so  many,  it  is  usually  an  unduly  arbitrary  and  in- 
flexible arrangement. 

Conclusion. — Both  transfer  and  promotion  if  they  are  to  be 
pursued  as  consistent  policies  will  require  courage,  insight, 
experimentation  and  patience  on  the  management's  part.  There 
are  significant  indications  in  the  recent  experiences  of  a  number 
of  plants  that  efforts  in  this  direction  will  IK?  amply  repaid.  But 
at  the  present  stage  experiments  must  be  largely  rooted  in  faith — 
faith  that  the  positive  qualities  of  human  nature  will  respond 
when  given  a  chance. 

Any  transfer  or  promotion  plan  which  is  to  be  permanently 
Bound  should,  therefore,  meet  this  test:  Does  the  plan  stimulate; 
and  draw  out  the  desire  of  people  to  be  creative,  to  be  interested 
in  their  own  activity,  to  excel,  to  win  approval,  to  develop  in 
power  of  self-expression?  Every  provision  which  can  be  intro- 
duced into  an  organization  to  release  human  energies  and  talents 
in  these  ways  will  help  to  bring  a  new  spirit  and  a  new  result  in 
terms  of  output. 

Selected  References 

ARNOLD,    H.    L.    and    F.   L.  FATIKOTK.     Ford  Methods  and  Ford  Shops. 
N.  Y.,  KngiruMTinK  Magazine  ('<».,  1915. 


TRANSFER  AND  PROMOTION  235 

GILBRETH,  F.  B.  and  L.  M.  GILBRETH.     Three  Position  Plan  of  Promotion 

(Annals,  Am.  Acad.  v.  65,  pp.  289-296,  May,  1916.) 
HOXIE,   R.   F.     Scientific   Management  and  Labor.     N.  Y.,  D.  Appleton 

&  Co.,   1918,     pp.  92-95. 
KELLY,  R.   W.     Hiring  the  Worker.     N.  Y.,  Engineering  Magazine  Co., 

1918,  pp.  123-142. 
LINK,   H.   C.     Employment  Psychology.     N.   Y.,   Macmillan   Co.,    1919, 

pp.  297-319. 
MACARTHUR,   W.   S.     Promotions  and  Transfers.     (National  Association 

Employment  Managers.     Proceedings  1st  Annual  Convention,  Cleve- 
land, Ohio,  May  21-23,  1919,  pp.  56-63.) 
PARKER,    C.    H.     Technique   of  American  Industry.     (Atlantic  Monthly, 

v.  125,  pp.  12-22,  Jan.,  1920.) 
REDFORD,    G.  S.     Handling  Men.     (Independent,  v.   92,  p.  340,  Nov.  17, 

1917.) 

REILLY,  P.  J.     Planning  Promotion  for  Employees  and  Its  Effect  in  Re- 
ducing Labor   Turnover.     (Annals,    Am.  Acad.,  v.    71,    pp.  136—139, 

May,  1917.) 
ROBBINS,    HAYES.     Personal    Factor    in    the    Labor    Problem       Atlantic 

Monthly,  v.  99,  pp.  729-736,  June,  1907.) 
SLIGHTER,    S.   H.     Turnover  of   Factory  Labor.     N.   Y.,   D.  Appleton  & 

Co.,  1919,  pp.  355-372. 
TUCKER,  W.  J.     Personal  Power:  Counsels  to  College  Men      Boston  and 

N.  Y.,  Houghton,  Mifflin  Co.,  1910. 
THORNDIKE,     E.     L.     Individuality.     Boston    and     N.     Y.,     Houghton, 

Mifflin  Co.,    1911. 


CHAPTER  XVII 
SHOP  RULES,  GRIEVANCES  AND  DISCHARGE 

Wo  shall  consider  in  this  chapter  the  several  topics  which 
relate  closely  to  the  maintenance  of  order  and  good  conduct  in 
the  shop — shop  rules,  absenteeism  and  tardiness,  individual 
delinquencies  of  all  sorts,  grievances  and  discharge.  All  of  these 
matters  effect  the  permanency  and  the  effectiveness  of  the  per- 
sonnel; and  they  are  matters  which  must  be  handled  with  a 
special  degree  of  deftness,  fairness  and  wisdom  if  results  are  to 
be  at  all  satisfactory.  But  it  is  impossible  to  include  here  all 
our  suggestions  regarding  the  preservation  of  shop  order, 
related  so  closely  is  this  question  to  job  analysis,  payment,  in- 
terest in  work,  the  functioning  of  shop  committees  and  employees' 
associations,  and  to  collective  bargaining. 

If,  therefore,  the  present  discussion  is  read  in  close  connection 
with  the  chapters  on  the  above  mentioned  subjects,  it  will  then 
be  easier  to  see,  what  we  can  only  assert  at  this  point,  that  wo  are 
here  discussing  topics  over  which  acute  controversy  and  a  diver- 
gence of  interest  may  occasionally  appear.  And  to  the  extent 
that  this  is  true,  the  questions  at  issue  will  have  to  be  handled 
in  a  way  calculated  to  give  expression  and  weight  to  every  point 
of  view  and  to  assure  considerate  treatment  of  every  individual 
involved. 

It  will  also  contribute  to  the  wise  handling  of  these  so-called 
disciplinary  problems,  if  the  training  motive  is  kept  uppermost. 
This  means  that  the  management  should  strive  for  a  -spirit  of 
kindly  patience  and  reasonableness,  realizing  that  in  all  questions 
of  human  contact  and  adjustment  the  chances  for  misunder- 
standing and  error  are  fully  as  great  on  the  management's  side  as 
on  the  side  of  the  workers;  that  both  sides  can  learn  useful 
lessons  from  the  temperate  adjustment  of  shop  complaints  and 
grievances.  Correction  of  misunderstandings  requires  in  every 
instance  that  both  parties  be  prepared  to  examine  coolly  tho  facts 
and  the  issues;  and  bo  ready  to  admit  it  when  they  are  at  least 
partially  wrong,  and  be  ready  to  correct  their  own  mistakes. 

236 


SHOP  RULES,  GRIEVANCES  AND  DISCHARGE          237 

The  time  is  past  when  disciplinary  difficulties  can  be  solved  by 
highhanded  and  arbitrary  managerial  decrees.  It  is  a  sound 
dictum  of  industrial  no  less  than  of  political  philosophy,  that 
"only  an  unmitigated  despotism  demands  that  the  individual 
citizen  shall  obey  unconditionally  every  mandate  of  persons  in 
authority."'  The  time  has  come  when  from  a  strictly  business 
point  of  view  the  control  of  internal  shop  affairs  must  be  consid- 
ered by  management  and  workers  together. 

Thus  it  will  be  an  important  part  of  the  training  work  of  the 
plant  to  make  plain  throughout  the  organization  the  common 
interest  of  all  in  an  orderly  and  law-abiding  shop.  There  may 
indeed  be  issues  on  which  workers  and  management  will  find 
themselves  at  odds.  Certain  divergences  over  pay  and  hours 
may  be  of  such  a  character.  The  management  may  also  want 
rules  which  confine  the  worker  narrowly  to  his  bench;  the  work- 
ers may  seek  more  latitude  in  shop  conduct  than  the  managment 
believes  expedient.  But  once  agreement  on  shop  regulations 
is  reached,  it  is  in  the  common  interest  that  they  be  adhered  to 
by  all.  A  reasonable  degree  of  "law  and  order,"  promptness, 
and  subordination  of  individual  whims,  is  a  necessary  condition 
of  shop  efficiency.  Work  of  any  sort  presupposes  for  its  effect- 
ive doing  a  freedom  from  undue  interruption  and  distraction, 
a  regularity  of  attendance  and  effort,  which  in  the  long  run  bene- 
fits all. 

The  problem  of  securing  this  proper  balancing  of  individual 
and  group  prerogatives  is  usually  spoken  of  as  the  problem  of 
"discipline;"  and  certain  management  experts  have  even  selected 
"shop  disciplinarians."  Words  are  subtle  instruments;  and  it  is 
our  conviction  that  as  long  as  managers  think  in  terms  of  "dis- 
cipline," they  will  be  thinking  and  acting  in  terms  of  "you 
mind  me" — of  that  favorite  sign  on  the  foreman's  desk:  "If 
you  want  to  know  who's  boss  around  here,  just  start  something." 

This  is  manifestly  the  wrong  note  and  it  gives  a  false  emphasis. 
For  the  management,  in  treating  of  disciplinary  problems,  is 
treating  of  matters  in  which  the  psychological  element  is  large 
and  almost  all-important.  The  attitude  is  of  critical  signifi- 
cance. For  attitudes  on  one  side  breed  corresponding  attitudes 
on  the  other.  Arbitrariness  and  "firmne'ss"  on  the  part  of  the 
management  give  rise  to  "caprice"  and  "obstinacy"  among 
the  workers.  Reasonableness,  patience,  sympathy — these  oc- 

1  MILL,  J.  S.     Considerations  on  Representative  Government,  Chapter  II. 


238  PERSONNEL  ADMINISTRATION 

casion  a  response  which  is  in  the  same  temper.  Hence  the  sooner 
the  notion  of  "disciplining  the  shop"  can  be  dropped,  the  tetter 
it  will  be.  We  shall,  therefore,  in  this  volume  use  the  phrase 
"shop  control"  to  connote  the  several  matters  of  which  this 
chapter  treats — with  the  suggestion  in  passing  that  as  soon  as 
possible  the  word  "discipline"  should  be  dropped  from  the 
industrial  vocabulary. 

Shop  Rules. — Every  shop  has  a  certain  number  of  rules 
which  it  is  in  the  common  interest  to  adopt  and  adhere  to.  Such 
rules  usually  relate  to  the  following  subjects;  attendance  and 
records  of  attendance,  safety  and  the  observance  of  safety  rules, 
health  and  the  observance  of  hygienic  precautions,  matters  of 
personal  conduct  like  falsifying  records,  drunkenness  in  the  shop, 
sex  irregularities,  profanity,  fighting,  stealing  from  the  company 
or  other  workers,  smoking,  and  special  rules  required  by  the 
nature  of  the  work. 

It  is  important  to  consider  how  such  rules  should  be  formu- 
lated; how  they  should  be  adopted;  how  workers  should  bo 
acquainted  with  them;  how  they  should  be  enforced — which 
involves  the  question  of  penalties  and  fines. 

There  are  in  the  experience  of  many  progressive  plants  three 
steps  in  the  development  of  shop  control.  Originally  the  man- 
agement formulated  the  rules  itself  and  posted  them  on  the 
bulletin  boards  Presumably  the  workers  read  these  rulos;  and 
continuance  at  the  job  was  taken  to  mean  their  agreement  to 
abide  by  them.  This  is,  of  course,  the  simplest  way  of  achieving 
good  behavior  in  the  shop.  It  carries  with  it  only  one  short- 
coming. It  does  not  assure  such  good  behavior.  It  tends  only 
to  assure  a  nominal  observance  of  rules,  while  the  management 
is  watching  Not  knowing  why  existing  rules  are  in  effect, 
workers  see  no  reason  for  inconveniencing  themselves  to  carry 
them  out.  This  method  wholly  ignores  the  training  motive}. 
The  appeal  is,  implicity  at  least,  to  the  fear  motive.  And  it  ha« 
all  the  weaknesses  that  the  appeal  to  fear  usually  creates— sullen- 
ness,  stubbornness  and  desire  to  "get  away  with"  infringements 
just  for  the  adventure. 

The  second  stage'  in  the  effort  to  secure  effective  shop  control 
has  been  to  give  over  io  tho  personnel  department  the  formula- 
tion of  rules.  This  presumably  results  in  a  more  mature  con- 
sideration of  the  reasonableness  of  and  necessity  for  such  rules 
as  arc  adopted,  than  is  the  case  when  no  expert  executive  devises 


SHOP  RULES,  GRIEVANCES  AND  DISCHARGE          239 

them.  Moreover,  it  supplies  a  method  of  transmitting  rules  to 
the  workers,  since  it  is  a  frequent  practice  to  include  all  regula- 
tions in  the  employees'  handbook,  edited  by  this  department, 
and  given  by  it  to  every  employee. 

The  third  stage  is  to  make  the  formulation  of  rules  a  subject 
for  conference  with  workers  in  shop  committees,  or  with  labor 
unions  if  there  is  a  collective  bargain.  Where  either  of  these 
instruments  of  joint  dealing  exists,  it  forms  the  natural  agency 
through  which  the  problem  of  shop  control  should  be  considered. 
For  it  is  only  through  the  development  of  self-control  and  vol- 
untary acquiescence  in  rules  that  permanent  social  control  can 
be  obtained.  Indeed,  so  essential  is  some  organized  expression  of 
the  workers  on  these  matters  that  if  no  shop  committee  existed, 
we  should  be  prepared  to  recommend  one  if  for  nothing  else 
than  for  this  purpose  of  helping  to  draw  up,  adopt  and 
enforce  the  shop  rules,  and  to  consider  shop  grievances  and 
discharge. 

The  shop  rules  are,  it  should  be  remembered,  the  local  ordi- 
nances of  industry.  And  if  their  essentially  legislative  character 
is  borne  in  mind,  managers  will  come  naturally  to  the  following 
conclusions: 

The  character,  scope  and  content  of  shop  rules  should  be 
agreed  to  by  the  workers  or  their  delegates.  If  such  agreement 
is  not  definitely  secured  and  the  workers  find  any  of  the  rules 
unreasonable,  they  will  be  restive  under  them  and  reluctant  to 
observe  them.  Indeed,  the  mere  fact  that  they  are  laid  down 
by  someone  else  is  sufficient  reason  for  many  people  to  object  to 
them;  whereas  they  will  willingly  enough  subscribe  to  even 
more  stringent  rules  if  they  themselves  have  a  hand  in  framing 
them.  Sound  government  in  industry,  as  elsewhere,  is  based 
upon  the  voluntary  consent  of  the  governed. 

Rules  should  be  as  few,  as  simple,  as  reasonable  as  possible. 
They  will  thus  the  more  readily  command  the  loyal  assent  and 
observance  of  all. 

Rules  should  be  well  advertised  to  all  affected  by  them.  No 
one  method  of  publicity  is  alone  sufficient.  The  bulletin  board 
should  be  used;  likewise  the  company  magazine,  the  employees' 
handbook,  inserts  in  the  pay  envelope,  and  patient  verbal  con- 
ferences with  any  illiterate  workers. 

Penalties  imposed  by  rules  should  in  the  same  way  be  made 
known  to  all  and  agreed  to  by  all. 


240  PERSONNEL  ADMINISTRATION 

Finally,  there  should  be  some  definite  agency  within  the  shop 
to  which  the  employee  can  complain  or  appeal  if  he  feels  that 
he  has  been  wrongly  accused  of  breaking  a  rule,  or  that  some 
mitigating  circumstance  warrants  an  exception  in  his  case. 

How  should  rules  be  enforced?  The  usual  threat  which  is 
held  over  the  worker's  head  is  discharge.  We  shall  consider 
this  method  presently.  Some  companies  impose  a  fine  for  loss 
of  tools  or  identification  badges;  in  some  plants  an  individual 
"progress  record,"  is  kept,  and  all  breaches  of  rules  are  noted 
thereon.  This  record  is  then  taken  into  account  in  determining 
pay  advances  and  promotion.  Other  companies  adopt  a  more 
positive  policy  and  reward  faithful  observance  of  rules  by  an 
occasional  half-holiday,  a  longer  vacation  or  a  bonus.  In  all 
these  cases,  however,  the  management  acts  as  the  sole  judge. 

With  the  growth  of  the  shop  committee  idea,  this  procedure 
will  tend  to  change  almost  automatically.  For  once  employee 
representation  exists,  any  interpretation  of  rules  or  imposition  of 
penalty  which  is  felt  to  be  unfair,  will  be  immediately  taken  up 
by  the  shop  committee.  This  committee  action  has  moreover 
its  positive  side  in  helping  in  the  determination  of  ability  and 
good  conduct.  For  managers  who  proceed  to  individual  ratings 
without  taking  account  of  workers'  estimates  of  each  other  lose 
substantially.  In  reality  the  workers  themselves  usually  know 
as  much  if  not  more  than  the  management  about  the  hour-to- 
hour  attitude  and  worth  of  their  fellows  in  the  shop. 

But,  it  will  be  said,  to  act  in  the  direction  of  autonomy 
in  the  control  of  shop  conduct  would  invite  disorder  and  con- 
fusion. This  might  indeed  be  true  if  the  management  simply 
"turned  over"  the  shop  control  to  the  workers  absolutely.  Yet 
even  if  it  did,  it  is  a  truism  that  when  people  arc  given  a  respon- 
sibility they  are  likely  to  exercise?  it  more  vigorously  upon  them- 
selves and  their  follows  than  they  would  tolerate  its  exercise 
by  another.  Self-discipline  can  always  furnish  a  more  resolute 
and  insistent  control  than  discipline  imposed  by  another. 
Self-discipline  is,  also,  vastly  tin;  more  educational.  And  it  is  on 
this  ground  that  objections  to  a  larger  shop  autonomy  than  is 
now  usual  is  best  met. 

We  are  not,  however,  proposing  hero  that  the  workers  "run 
the  shop."  We  are  rather  proposing  that  order,  system  and 
promptness  be  recognized  a«  a  common  interest  of  manager  and 
managed,  and,  therefore,  a  proper  joint  responsibility.  And 


SHOP  RULES,  GRIEVANCES  AND  DISCHARGE          241 

the  management  must  usually  take  the  lead  in  bringing  about  a 
mutual  recognition  of  the  value  of  this  common  interest.  But 
it  must  be  leadership  in  a  joint  enterprise — the  joint  enterprise 
of  assuring  proper  shop  control. 

"It  is  but  poor  education,"  we  are  warned,  "that  associates  ignorance 
with  ignorance,  and  leaves  them  (the  people),  if  they  care  for  knowl- 
edge, to  grope  their  way  to  it  without  help,  and  do  without  it  if  they  do 
not  want  it." 

''What  is  wanted  is  the  means  of  making  ignorance  aware  of  itself, 
and  able  to  profit  by  knowledge;  accustoming  minds  which  know  only 
routine  to  act  upon  and  feel  the  value  of  principles;  teaching  them  to 
compare  different  modes  of  action,  and  learn,  by  the  use  of  their  reason, 
to  distinguish  the  best  ....  When  we  desire  to  have  a  good  school 
we  do  not  eliminate  the  teachers."1 

In  short,  shop  control  is  best  secured  when  it  is  administered 
jointly  and  when  the  management  assumes  the  role  of  apostle — 
but  not  fanatic — of  law  and  order. 

Absence  and  Tardiness. — Many  plants  today  suffer  a  loss  of 
production  due  to  absence  and  tardiness  which  may  exceed  the 
loss  caused  by  the  turnover  of  labor.  And  unquestionably  a 
careful  effort  to  control  these  two  items  will  be  to  everyone's 
interest. 

Reduction  of  absence  and  tardiness  requires,  in  the  first  place, 
knowledge  of  their  causes.  Such  knowledge  is  not  obtainable 
without  a  close  check-up  of  each  instance.  This  is  secured  in 
some  companies  by  having  each  absentee  and  all  workers  who 
are  tardy  more  than  three  or  four  minutes  report  for  work  via 
the  personnel  office — a  practice  which  of  itself  has  tended  to  re- 
duce irregularities  in  attendance.  And  when,  as  is  done  in 
several  companies,  all  delinquents  are  brought  before  a  committee 
of  workers,  the  amount  of  broken  time  is  found  to  fall  rapidly. 

A  procedure  of  absentee  control  should  include  an  absence 
record  sent  by  the  foreman  of  each  department  to  the  personnel 
office  within  half  an  hour  after  starting  time  each  morning.  This 
record  should  contain  the  name  of  each  absentee,  and  should  as  a 
matter  of  routine  go  in  duplicate  to  the  employment  office,  the 
nurse's  office,  and  the  planning  department.  Absences  can  thus 
be  looked  into  before  the  worker  returns,  and  the  day's  assign- 
ment of  work  be  rearranged  in  accordance  with  the  attendance. 

Follow-up  of  absences  involves,  however,  one  of  those  delicate 

1  MILL,  J.  S.,  op.  cit.,  Chapter  XV. 
16 


242  PERSONNEL  ADMINISTRATION 

points  of  procedure  in  which  almost  everything  depends  on  how 
it  is  done.  A  visit  by  a  company  representative  to  the  absent 
worker's  home  on  the  first  or  second  day  of  his  non-attendance, 
may  be  a  kindly  and  considerate  act  of  inquiry  and  proffer  of 
help,  or  it  may  be  used  in  a  most  objectionable  way  as  an 
occasion  for  prying  into  purely  personal  affairs. 

We  are  not,  therefore,  prepared  to  discourage  the  practice  of 
follow-up  of  absentees  by  personal  visits.  But  the  goodwill  of 
the  working  class  community  will  only  be  retained  in  the  long 
run  if  the  visit  is  made  by  a  kind,  tactful  and  discreet  woman  nurse 
whose  natural  first  concern  is  a  solicitude  for  the  health  of  the 
absent  worker.  If  the  worker  is  not  sick  and  if  he  or  his  family 
does  not  volunteer  information  as  to  the  reasons  for  the  absence,  the 
nurse's  work  as  an  agent  of  the  company  should  be  considered 
finished  If  the  worker  wants  to  look  elsewhere  for  a  job,  if  he 
wants  to  go  shopping,  if  he  has  earned  all  he  cares  to  in  the 
week — that  is  his  concern;  although  he  stands  of  course  to  re- 
ceive any  consequences  of  unexcused  and  unexplained  absence 
which  may  be  jointly  adopted  and  embodied  in  the  shop  rules. 
And  it  is  also,  of  course,  legitimate  and  often  a  necessary  work  of 
management  to  endeavor  to  educate  employees  into  more  re- 
sponsible and  more  regular  working  habits. 

A  drive  to  reduce  lateness  and  absence  will  usually  disclose  other 
remediable  causes  besides  sickness  Bad  transportation,  un- 
wholesome recreational  provisions,  poor  housing  accommodations 
with  the  consequence  of  poor  sleep,  too  hard  work,  unhealthy 
and  unattractive  working  conditions — these  are  all  familiar  con- 
tributing causes.  And  they  demand  simultaneous  consideration. 

Positive  work  in  bettering  attendance  can  also  be  done  by 
giving  conspicuous  notice  and  public  mention  to  those  who  are 
regular  in  attendance.  By  this  sort  of  public  record  an  emula- 
tive spirit  between  departments  can  be  usefully  encouraged. 
Much  can  also  be  done  in  the  direction  of  encouraging  workers 
to  notify  the  company  both  of  contemplated  absence  in  advance 
or  by  telephone  on  the  day  of  absence  if  it  is  suddenly  required. 
Many  companies,  because  of  its  beneficial  effect  on  attendance, 
justify  the  provision  and  loan  on  rainy  mornings  of  dry  shoes 
and  stockings,  and  on  rainy  afternoons  of  umbrellas  and  rubbers. 

Attendance  can  at  times  be  used  as  a  factor  in  payment.  But 
that  such  recognition  should  take  the  form  of  an  attend- 
ance bonus  eeems  to  us  an  unduly  artificial  and  permanently 


SHOP  RULES,  GRIEVANCES  AND  DISCHARGE          243 

unsatisfactory  method  of  securing  something  which  the  manage- 
ment has  presumably  already  contracted  for — namely,  the  regu- 
lar attendance  of  its  workers.  It  is  usually  poor  policy  to  give 
special  rewards  for  fulfilling  obligations  which  it  is  in  the  nature 
of  the  agreement  to  fulfill. 

Full  and  regular  attendance  is  like  other  items  in  sound 
management  in  that  it  is  important  but  should  not  be  a  fetish. 
When  managements  do  not  send  a  sick  girl  home,  when  they 
send  a  "strong-arm"  man  to  corral  absent  workers,  when  the 
worker  who  is  a  few  minutes  late  is  made  to  lose  a  whole  morning's 
work,  when  sick  employees  are  encouraged  to  return  to  work 
before  full  recovery — regular  attendance  which  is  really  a  means, 
is  being  unwisely  made  an  end. 

Moreover,  it  should  be  remembered  that  in  some  cases  absence 
may  be  a  physiologically  sound  "defense  mechanism" — dictated 
by  the  worker's  feeling  that  he  is  "fed  up"  on  work  and  needs  a 
change.  Any  company  which  pursues  a  firm  policy  on  regular 
attendance  should  consequently  be  prepared  to  adopt  the  essen- 
tial supplementary  policy  of  regular  holidays  and  vacations.  For, 
although  it  is  important  to  be  able  to  count  on  the  worker's 
presence  when  the  shop  is  running,  managements  must  realize 
that  under  present  conditions  regular  attendance  for  300  days  a 
year  is  likely  to  be  for  the  manual  worker  a  severe  physical  tax. 

Individual  Delinquencies. — It  is  frequently  true  that  some 
offenses  and  violations  of  rules  are  made  the  cause  of  absolute 
discharge.  Definite  and  firm  treatment  of  flagrant  dishonesty, 
immorality  and  willful  disobedience  is  certainly  necessary.  But 
it  is  especially  important  here  to  remember  that  a  man  should  be 
tried  by  a  jury  of  his  peers;  should  have  the  chance  to  speak  fully 
in  his  own  defense;  and  should  be  considered  innocent  until  his 
guilt  is  established. 

It  should  further  be  remembered  that  the  black-marking  of  a 
man  for  a  first  offense  may  debar  him  from  securing  employment 
anywhere  in  the  locality.  Justice  may  helpfully  be  tempered 
with  mercy  since  the  prerequisite  of  reform  is  not  the  moral 
aloofness  of  other  workers  and  employers,  but  a  disposition  to 
give  the  delinquent  another  chance  to  make  good. 

Moreover,  when  any  serious  offense  against  the  statutory  law 
has  been  committed,  the  company  should  not  forget  that  unless 
satisfactory  adjustment  is  immediately  effected,  the  State  and 
not  the  employer  is  the  one  to  see  justice  done. 


244  PERSONNEL  ADMINISTRATION 

Grievances. — It  will  perhaps  seem  odd  to  some  that  we  do  not 
give  more  conspicuous  attention  to  the  handling  of  grievances. 
But  a  reading  of  the  chapters  on  shop  committees  and  collec- 
tive bargaining  will  show  how  really  important  we  believe  this 
question  to  be.  And  our  suggestions  for  handling  grievances 
are  there  embodied  more  extensively. 

A  grievance  is  an  evidence  of  some  temporary  misunderstand- 
ing and  maladjustment  in  the  relation  of  the  worker  to  the  com- 
pany. It  can  be  treated  in  one  of  two  ways.  It  can  be  ignored 
— in  which  case  a  sense  of  thwarted  and  suppressed  desire  tends 
to  develop.  The  original  cause  of  the  maladjustment  tends  to 
be  magnified  or  distorted  and  if  other  grievances  occur  before  the 
first  is  corrected,  a  progressively  intense,  sensitive  and  unreason- 
ing conviction  of  ill-treatment  is  fostered.  "Certain  specific 
grievances,  when  long  unconnected,  not  only  mean  definite  hard- 
ships; they  serve  as  symbols  of  the  attitude  of  employers  and 
thus  affect  the  underlying  spirit."1 

The  second  method  of  treatment  is,  therefore,  the  only  safe 
one.  Let  in  the  light,  air  and  sunshine  upon  all  grievances! 
Keep  the  air  clear  and  the  atmosphere  free  of  any  vague  uneasi- 
ness! And  this  can  be  accomplished  in  only  one  way:  Have 
an  organized  channel  of  communication  through  which  the 
worker  can  make  his  grievance  heard  with  confidence  that  it  will 
be  promptly  considered. 

This  organized  channel  will  qualify  as  an  effective  medium  to 
the  extent  that  it  has  the  workers'  confidence  and  to  the  extent 
that  it  displays  fairness.  These  two  essential  qualifications 
may  be  assured  if  the  grievances  are  handled  informally  by  the 
personnel  department,  or  by  some  superior  executive,  especially 
if  they  are  purely  personal  difficulties.  But  in  the  long  run 
promptness  and  fairness  are  better  assured  under  a  joint  commit- 
tee of  management  and  employee  representatives,  on  which  each 
side  has  equal  voting  power  and  the  only  appeal  (if  any  exists  on 
important  points)  is  to  some  disinterested  outsider. 

The  personnel  department  can  play  an  important  part,  however, 
in  collecting  the  facts  regarding  every  grievance  considered ;  and 
frequently  it  can  effect  a  settlement  of  minor,  personal  frictions 
which  need  not  take  the  time  of  a  grievance  committee. 

When,  however,  the  grievance  concerns  basic  terms  of  employ- 

1  Report  of  President's  Mediation  Commission  to  the  President  of  the 
United  States.  Washington,  1918,  p.  19. 


SHOP  RULES,  GRIEVANCES  AND  DISCHARGE          245 

ment,  its  consideration  should  go  at  once  to  the  special  agencies 
for  dealing  with  those  matters  which  we  are  subsequently  dis- 
cussing in  the  chapters  on  job  analysis  and  payment. 

Especially  in  large  corporate  organizations,  there  are  other 
complex  and  baffling  grievances  to  reckon  with.  Both  office  em- 
ployees and  executives  themselves  should  have  someone  to  whom 
they  can  turn  for  the  consideration  of  their  grievances.  Jealousy, 
pride  of  place,  suspicion,  ambition,  taking  credit  for  another's 
work — these  are  all  such  a  source  of  waste,  friction  and  heat  in 
executive  groups  that  some  method  of  minimizing  them  should 
be  sought.  While  it  is  probably  true  that  a  formal  grievance- 
handling  agency  will  be  of  little  if  any  value,  much  can  be  done 
in  a  personal  way  to  eliminate  these  difficulties,  if  the  head  ex- 
ecutives, especially  the  personnel  manager,  will  keep  constantly 
in  mind  the  need  for  freeing  executive  organization  from  irrita- 
tions and  disturbances  of  this  sort. 

Discharge. — No  discussion  of  discharge  can  progress  far  which 
does  not  fully  recognize  how  momentous  an  event  discharge  is 
to  the  affected  worker.  "So  heavy  a  penalty  as  the  dismissal 
of  a  workman  (involving  to  him  a  serious  dislocation  of  his  life, 
the  perils  and  demoralization  attendant  on  looking  for  work, 
probably  the  uprooting  of  his  home  and  the  interruption  of  his 
children's  schooling,  possibly  many  weeks  of  penury  or  semi- 
starvation  for  his  family  and  himself)  ought  to  be  regarded  as 
a  very  serious  matter."1 

It  is  therefore  pertinent  to  inquire  how  discharge  is  handled 
and  how  it  might  be  handled  to  assure  fairness  to  both  the  inter- 
ested parties.  Four  general  types  of  procedure  are  in  use.  First, 
there  is  the  old  method  of  allowing  the  foreman  full  responsi- 
bility. But  where  personnel  departments  have  been  set  up,  they 
are  rapidly  supplanting  the  foremen. 

Indeed,  this  second  method  has  gained  greatly  in  favor  because 
in  every  instance  known  to  us  the  number  of  discharges  has  fallen 
20,  30,  and  in  one  plant,  as  high  as  65  per  cent,  without  any 
diminution  of  effective  shop  control  being  noted,  as  soon  as  the 
power  of  absolute  dismissal  was  taken  from  the  foreman  and  lodged 
in  the  personnel  department.  The  foreman  is  too  close  to  his 
workers,  and  not  sufficiently  in  touch  with  the  needs  of  the  rest 
of  the  factory  to  allow  him  to  have  final  say  over  complete  dis- 
charge. He  may  still  retain,  however,  the  right  of  immediate 

1  WEBB,  SIDNEY.     The  Works  Manager  Today,  p.  30. 


246  PERSONNEL  ADMINISTRATION 

suspension  and  of  dismissal  from  his  department  if  the  personnel 
department  cannot  persuade  him  to  reinstate  the  man.  For  there 
is  clearly  nothing  to  be  gained  by  having  a  superior  executive 
force  a  foreman  to  take  back  a  worker  whom  he  does  not  want 
and  will  not  treat  considerately. 

Another  useful  method  is  to  allow  no  man  to  receive  his  final 
pay  check  until  he  has  interviewed  the  personnel  department  and 
obtained  its  signature  for  his  discharge.  By  this  means  confer- 
ence with  a  personnel  worker  is  assured.  It  enables  him  to  look 
into  the  situation,  and  more  often  than  not  it  is  possible  to  put 
the  man  at  work  in  some  other  department,  if  his  offense  has 
not  been  of  such  a  character  as  to  warrant  his  release. 

Both  of  the  above  methods,  however,  imply  that  manage- 
ment alone  is  deciding  upon  the  Tightness  of  the  discharge.  But 
the  same  arguments  which  have  force  regarding  the  sound  han- 
dling of  shop  rules  and  grievances  would  seem  to  have  force  in  the 
handling  of  dismissal  cases  For  after  all,  discharge  results  from 
a  breaking  of  shop  rules  and  is  one  particular  grievance  which  the 
affected  worker  has  against  the  company. 

A  third  method  is,  therefore,  to  have  a  joint  committee  pass 
on  the  discharge,  in  case  the  personnel  department  has  found  it 
impossible  to  revoke  the  decision  of  the  foreman.  It  is  assumed 
here  that  there  has  already  been  prior  agreement  between 
management  and  men  upon  proper  causes  for  discharge ;  but  it 
is  also  assumed  that  on  matters  of  fact  and  interpretation  the 
discharged  employee  should  be  allowed  the  benefit  of  a  hearing 
and  even  of  appeal. 

In  other  words  a  first  principle  of  standard  practice  on  dis- 
charge is: 

Establish  in  joint  conference  those  causes  of  discharge  which 
all  parties  agree  it  is  equitable  to  enforce.  These  causes  should 
preferably  be  few  and  specific.  It  is,  therefore,  desirable  to  de- 
fine in  advance  of  the  offense,  "wilful  disobedience,"  "negli- 
gence," "incompetence"  and  "misconduct."  If  it  is  felt  by 
all  that  breach  of  certain  rules  about  attendance,  safety  practice, 
health  measures,  personal  morality  or  some  other  aspect  of 
shop  conduct  should  be  held  as  cause  for  irrevocable  dismissal 
(assuming  that  the  facts  are  fully  established),  it  will  not  be 
difficult  to  get  the  explicit  agreement  of  the  workers  on  these 
points. 

Some  companies  in  instituting  shop  committees  and  employees' 


SHOP  RULES,  GRIEVANCES  AND  DISCHARGE          247 

associations  have  brought  before  the  workers  a  finished  plan  of 
procedure  with  a  number  of  causes  of  discharge  (in  one  case  as 
high  as  25)  already  specified — and  acceptance  of  the  plan  meant 
acceptance  of  all  those  causes  as  valid.  A  far  better  way  is  to 
provide  in  the  constitution  of  the  shop  committee  for  subsequent 
joint  agreement  in  committee  on  valid  causes  for  absolute  dis- 
charge— with  perhaps  a  referendum  of  all  the  workers  upon  the 
committee's  recommendations. 

Where  a  collective  bargain  is  in  force,  it  will  usually  provide 
some  joint  machinery  for  consideration  of  discharge  and  will 
also  in  most  cases  state  certain  causes  which  are  recognized  as 
absolute.  An  interesting  example  of  how  this  problem  is  met  in 
order  to  guard  the  interests  of  both  sides  is  seen  in  a  recent  agree- 
ment in  one  of  the  garment  industries  where  the  "right  to  dis- 
charge" had  been  in  violent  dispute.  The  contract  provides 
that  during  the  first  two  weeks  of  employment  every  worker 
shall  be  considered  as  on  a  "probationary  period,  and  there  shall 
be  no  review  of  the  discharge  of  any  worker  during  said  period."1 
In  the  event  of  discharge  "after  said  probationary  period,  the  dis- 
charged worker  shall  be  entitled  to  a  review  thereof"  by  repre- 
sentatives of  the  organized  employers  and  organized  workers,  and 
failing  agreement  by  them,  by  an  impartial  outsider.  If  the 
discharge  is  sustained  no  further  action  is  taken.  If  it  is  not, 
several  alternatives  are  open,  which  depend  in  part  upon  the 
length  of  service  of  the  discharged,  but  include  reinstatement 
or  a  "dismissal  wage."2  The  important  thing  to  note,  however, 
is  that  the  "right  to  discharge"  is  definitely  restricted  in  the 

1  Monthly  Labor  Review,  U.  S.  Bureau  of  Labor  Statistics,  June,  1919,  p.  14. 

2  "  (1)  If  the  discharged  worker  had  been  employed  for  a  period  of  more 
than  two  weeks,  but  less  than  four  months,  the  employer  is  given  the 
option  of  reinstating  the  employee  or  of  paying  him,  in  lieu  of  reinstatement, 
a  dismissal  wage  or  fine.     The  amount  of  the  fine  is  to  be  fixed  by  the  chief 
clerks  of  the  respective  sides  or  by  an  impartial  person,  but  is  to  be  not 
less  than  one  weeks'  pay  nor  more  than  six  weeks'  pay;  (2)  if  the  discharged 
worker  has  been  employed  for  more  than  four  months,  the  chief  clerks  or  the 
impartial  person  (not  the  employer)  are  to  agree  whether  the  discharged 
worker  is  to  be  reinstated,  or  a  dismissal  wage  or  fine,  in  lieu  of  reinstate- 
ment, be  granted  to  him  (the  amount  to  be  granted  is  not  to  exceed  six 
weeks'  pay) ;  (3)  discharged  workers  are  to  be  reinstated  if  it  is  found  that 
they  have  been  dismissed  for  union  activity.     Appeals  from  discharges  for 
alleged  union  activity  are,  however,  limited  to  members  of  price  committees 
and  the  union  representatives  of  the  shop."     Monthly  Labor  Review,  U.  S. 
Bureau  of  Labor  Statistics,  June,  1919,  pp.  7-8 


248  PERSONNEL  ADMINISTRATION 

interests  of  fair  play  and  of  a  decision  free  from  heat  and  per- 
sonal bias. 

A  fourth  method  of  handling  discharge  is  to  turn  its  administra- 
tion over  entirely  to  a  committee  of  workers.  We  know  of  only 
one  company  which  uses  this  method — a  department  store; 
but  it  has  been  in  use  there  for  several  years  and  testimony  is 
unanimous  that  the  results  are  satisfactory. 

The  machinery  is  simple.  Every  pay  envelope  carries  printed 
on  its  outside  a  legend  stating  that  if  the  employee  feels  himself 
unjustly  treated  in  any  way,  he  is  urged  to  take  the  matter  to 
the  arbitration  board.  This  is  a  body  of  twelve  workers  elected 
by  their  fellow  workers  and  a  chairman  appointed  by  the  presi- 
dent of  the  employees'  association.  One  observer,  confirming 
our  own  conclusions,  says : 

"The  records  of  the  board  for  a  period  of  two  years  were  placed  at 
my  disposal.  I  went  over  them  carefully,  paying  special  attention  to 
cases  of  appeal  against  dismissal.  Here,  if  anywhere,  it  seemed  to  me, 
there  would  be  opportunity  for  decisions  made  without  regard  to  the 
interests  of  the  store.  I  found  thirty-nine  such  cases;  twenty-seven  of 
them  were  decided  in  favor  of  the  store.  Only  twelve  discharged  em- 
ployees were  ordered  reinstated.  When  I  read  the  proceedings  in  each 
case,  I  was  struck  with  the  conscientious  and  scrupulous  effort  to  be  fair 
to  the  store.  A  number  of  cases  which,  on  the  face  of  the  records, 
seemed  to  me  to  be  unfair  to  the  discharged  employee,  were  decided  in 
favor  of  the  management.  Only  where  the  employee's  case  was  un- 
usually strong  was  a  reinstatement  ordered."1 

Mr.  Fitch's  statement  serves  as  an  answer  to  the  objection 
that  the  employees  tend  to  be  easy  on  their  fellows.  Quite  the 
contrary  is  true,  not  only  here  but  wherever  employees  have  been 
trained  in  the  assumption  of  real  responsibility. 

While  not  wishing  to  press  the  conclusion  too  strongly  we  favor 
a  method  of  handling  discharge  through  joint  conference  along 
the  line  of  the  third  method  discussed. 

In  conclusion,  it  will  be  seen  that  our  suggestions  for  effective 
shop  control  grow  out  of  an  appreciation  of  the  sources  of  true 
"good  conduct"  and  orderly  behavior.  We  stress  the  positive 
side  of  shop  control,  believing  that  if  the  management  assumes 
its  responsibilities  adequately,  the  workers  will  assume  theirs. 
Much  depends  on  the  attitude  with  which  the  management 

1  FITCH,  JOHN  A.  Making  the  Bargain,  The  Survey,  Dec.  15,  1917, 
pp.  31&-319. 


SHOP  RULES,  GRIEVANCES  AND  DISCHARGE  249 

proceeds;  much  depends  on  having  the  organization  of  produc- 
tion so  well  in  hand  that  the  workers  will  normally  "tend  to 
business;"  much  depends  on  patient  adherence  to  the  training 
point  of  view. 

To  embark  upon  democratic  shop  control  will  seem  at  first  a 
venture  requiring  extraordinary  faith  in  human  nature.  But  in 
reality  it  is  not.  It  is  rather  a  scientific  step  based  on  knowl- 
edge that  self-discipline  is  the  only  kind  which  is  permanently 
adhered  to  without  resentment,  that  responsibility  is  only  as- 
sumed when  authority  is  specifically  decentralized,  and  responsi- 
bility is,  when  exercised,  an  exceedingly  sobering  and  tempering 
influence. 

The  shop,  we  must  never  forget,  exists  to  provide  a  life  as  well 
as  a  livelihood.  Hence,  the  objective  of  shop  control  is  not  the 
creation  of  an  atmosphere  of  fear,  gloom,  whispering  furtiveness 
and  straightlaced  uniformity.  There  is  room  in  the  truly  orderly 
shop  for  cheerfulness,  an  atmosphere  of  fellowship  and  even  of 
gaiety,  for  flexibility  and  individuality.  In  the  shop,  as  in  the 
community,  the  desirable  aim  is  freedom  through  law. 

Selected  References 
Absences — How  to   Reduce  Them.     (Factory,  v.  21,  pp.   231-233,    Aug., 

1918.) 
DOUGLAS,  P.  H.     Absenteeism  in  Labor.     (Political  Science  Quarterly,  v. 

34,  pp.  591-608,  Dec.,  1919.) 
FILENE'S,  WM.,  SONS  Co.     Thumbnail  Sketch  of  the  Filene  Cooperative 

Association.     Boston,  pub.  by  Company. 
GREAT   BRITAIN,   HEALTH   OF    MUNITION    WORKER'S    COMMITTEE.     Lost 

Time  and  Incentive.     (U.  S.  Bureau  of  Labor  Statistics  Bui.,  No.  249, 

1919,  pp.  101-107.) 
KEIR,  J.  S.     Reduction   of  Absences  and  Lateness  in  Industry.     (Annals, 

Am.  Acad.,  v.  71,  pp.  140-155,  May,  1917.) 
KIRKALDY,  A.  W.     Industry  and  Finance.    London,  Isaac  Putman  &  Sons, 

1917,  pp.  56-62. 
LEITCH,  JOHN.     Man  to  Man,  A  Story  of  Industrial  Democracy.     N.  Y., 

B.  C.  Forbes  Co.,  1919,  pp.  183-185. 
LOVEDAY,     THOMAS.     Causes     and     Conditions     of     Lost     Time.     Great 

Britain,  Health  of  Munition    Workers'   Committee,  No.  7,  1917,  pp. 

41-67. 
METCALP,    H.    C.     Grievances.     (National    Association    of    Corporation 

Schools,  addresses,  reports,  etc.,  4th  Annual  Convention,  Pittsburgh, 

Pa., May  30-June  2,  1916,  pp.  346-358.) 
QUINSY,   R.  S     How  We  Investigate  Absences  and  Why.     (Factory,  v.  21, 

pp.  438-439,  Sept.,  1918.) 
RECTANUS,  S.  R.     Absenteeism.     (U.  S.  Bureau  of  Labor  Statistics,  Bui. 

247,  1919,  pp.  28-35.) 


250 


PERSONNEL  ADMINISTRATION 


ROCHESTER    CHAMBER    OF    COMMERCE.     Report    on    Absenteeism     and 

Tardiness.     Rochester,    N.    Y.,    pub.    by    Chamber   of    Commerce, 

1917. 
SLIGHTER,  S.  H.     Turnover  of  Factory  Labor.     N.  Y.,  D.  Appleton  &  Co., 

1919,  pp.  266-268;  386-400. 
U.  S.  INFORMATION  AND  EDUCATION  SERVICE  (DEPARTMENT  OF  LABOR). 

Absenteeism.     Washington,  Department  of  Labor,  Bid.  No.  1. 
U.  S.  SHIPPING  BOARD,  EMERGENCY  FLEET  CORPORATION.     Absenteeism 

and  Tardiness.     (In  Its  Labor  Loss,  1918,  pp.  11-14.) 
WEBB,  SIDNEY.     Works  Manager  Today.    N.  Y.,  Longmans,  Green  &  Co., 

1918,  pp.  103-21. 


CHAPTER  XVIII  ^ 

JOB  ANALYSIS  AND  JOB  SPECIFICATIONS 

It  is  important  to  be  explicit  as  to  why  we  give  job  analysis 
such  prominence  in  a  book  on  human  relations  in  industry.  We 
find  at  least  four  vital  points  at  which  the  significance  of  job 
study  cuts  directly  across  the  path  of  the  personnel  adminis- 
trator's work;  and  how  intimate  the  connection  is  can  be  most 
graphically  indicated  by  four  types  of  illustration. 

There  is  crying  need,  in  the  first  place,  for  scientific  knowledge 
about  a  "fair  day's  work."  In  one  tannery  known  to  us  the 
girls  on  week  work  at  a  certain  operation  finished  seventy-five 
dozen  skins  a  day.  The  management  was  confident  that  this 
was  too  little  and,  after  consulting  with  the  girls  and  assuring 
them  of  earnings  at  least  equal  to  their  week  rates,  changed  the 
job  to  piece  work.  At  once  the  output  rose  to  one  hundred 
dozen  a  day  and  has  remained  at  that  average  ever  since,  ap- 
parently without  any  ill  effects  on  the  health  of  the  girls. 

At  another  factory  a  policy  of  limitation  of  output  was 
enforced  by  one  hundred  and  fifty  men  by  collecting  the  pay  en- 
velopes of  each  worker  to  assure  that  no  man  earned  over  $4.75 
per  day.  Eventually  conditions  changed;  restrictions  were  re- 
moved from  the  amount  of  work  that  a  man  could  do  in  a  day; 
and  presently  thirty  men  were  turning  out  the  entire  amount  and 
earning  from  eight  to  nine  dollars  a  day. 

In  our  shipyards  early  in  the  war  the  number  of  rivets  driven 
per  day  was  often  considered  low  by  employers,  although  there 
were  clearly  many  contributing  factors  for  which  they  were 
themselves  responsible.  Nevertheless  the  testimony  is  wide- 
spread that  when  the  Shipbuilding  Labor  Adjustment  Board 
announced  that  it  would  allow  no  cutting  of  piece  rates  during 
the  war,  the  output  frequently  increased  50  per  cent,  and  even 
75  per  cent.  In  Melbourne,  Australia,  a  local  paper  recites  that, 
"an  ordinary  day's  work  for  a  riveter,  as  work  is  done  at  other 
yards,  is  295  rivets.  The  Cockatoo  Island  riveters  fell  to  75. 

251 


252  PERSONNEL  ADMINISTRATION 

When  the  manager  remonstrated  with  them  the  work  per  man 
increased  on  an  average  two  and  a  half  rivets  per  day."1 

The  problem  of  defining  the  day's  work  presents  itself  likewise 
in  the  garment  trades.  In  the  manufacture  of  dresses  and 
waists,  for  example,  it  has  been  customary  for  certain  operations 
to  be  done  on  a  piece  work  basis.  The  hourly  rate  is  fixed  by  a 
collective  bargain.  The  difficulty  then  is  to  convert  the  hourly 
rate  into  a  piece  rate  which  shall  be  fair  to  both  sides,  and  give 
a  weekly  wage  approximating  that  secured  by  multiplying  the 
hourly  rate  by  the  number  of  hours  worked  per  week.  But  if 
the  employer  undertakes  a  test  to  show  how  long  the  operation 
takes  the  temptation  is  to  set  a  fast  pace  which  could  not  be 
regularly  maintained;  and  if  the  employees  make  the  test  the 
tendency  is  for  the  operations  to  be  done  slowly  so  that  the  fast 
workers  can  make  good  money.  This  problem  occasions  endless 
controversy,  ill-will  and  unfairness.  The  need  for  some  more 
scientific  study  of  the  work  is  obvious. 

Second,  there  is  need  of  accurate  knowledge  of  the  surrounding 
conditions  and  modifying  factors  at  jobs.  There  has  from  time 
to  time  been  considerable  friction  over  terms  of  employment  for 
street  car  motormen  and  conductors.  Periodically  in  our  large 
cities,  the  public  confronts  an  interruption  of  work,  and  then 
begins  to  discover  that  the  terms  of  employment  or  the  attend- 
ant conditions  are  not  what  they  should  be.  But  there  is  no 
organized  body  of  knowledge  as  to  the  exact  work-content  of  the 
traction  employees'  jobs  in  a  given  city.  We  do  not  know  ac- 
curately the  over-all  hours  per  day  and  per  week,  the  weekly 
wage,  the  yearly  income,  the  sickness  liability,  the  average 
length  of  employment,  the  rapidity  of  promotion,  attendant 
conditions  in  such  matters  as  eating  accommodations,  rest 
rooms,  toilet  facilities  away  from  the  barns  and  numerous  other 
items.  And  then  when  the  public  finds  the  workers  restive  it 
tries  in  a  hurried,  superficial  way  to  get  the  facts  and  to  have 
conditions  corrected.  This  statement  applies  with  equal  ac- 
curacy to  the  work  of  employees  of  the  stoam  railroads.  The 
content  of  the  work  of  the  engineer  and  the  fireman  on  different 
types  of  locomotives  shows  a .  wide  divergence ;  yet  little  is 
generally  known  about  this  by  those  who  attempt  to  arbitrate 
railroad  wage  disputes.  The  need,  of  course,  is  for  job  analyses 
kept  currently  correct,  and  accessible  for  public  enlightenment. 

1  Melbourne  Argus,  Feb.  13,  1919. 


JOB  ANALYSIS  AND  JOB  SPECIFICATIONS  253 

An  illustration  of  a  third  type  is  found  in  a  certain  cotton  mill 
where  the  owner  has  an  inventive  friend  who  has  free  access  to 
his  mill  for  purposes  of  experimentation,  on  condition  that  the 
owner  have  the  free  use  of  any  available  inventions.  The  in- 
ventor spends  days  and  days  in  the  observation  of  a  given  job 
and  gradually  as  its  elements  become  clear  in  his  mind,  he  sees 
the  way  in  which  a  machine  could  be  devised  to  do  the  work, 
and  do  it  more  quickly.  He  installs  a  crude  model  and  in  con- 
junction with  workers  and  mechanics  gradually  brings  it  to 
perfection.  In  one  case  the  result  was  a  contrivance  which  saved 
the  work  of  four  people  for  every  machine  used.  This  simple 
example  from  an  industry  in  which  operations  are  thought  to 
have  reached  a  high  degree  of  standardization,  testifies  to  the 
need  of  widespread  study  of  possible  improvements  in  machine 
and  method. 

Fourthly,  the  importance  of  knowing  the  effect  of  work  on 
workers  is  too  often  ignored.  We  have  been  in  plants  where  the 
conditions  surrounding  a  given  job  plus  the  content  of  the  job 
itself  were  such  as  to  have  an  obviously  deleterious  effect  on 
anyone  who  remained  longer  than  a  few  weeks.  In  one  factory, 
in  the  department  that  was  doing  a  bronze  bath  operation,  the 
foreman  had  to  leave  for  a  month  regularly  every  five  or  six 
months  in  order  to  recover  sufficient  health  and  strength  to 
continue  at  work;  and  no  worker  was  ever  known  to  stay  at 
the  operation  more  than  three  months.  And  yet  that  condi- 
tion had  gone  uncorrected  and  unstudied  for  a  number  of  years. 

These  examples  could  be  multiplied  by  the  score  out  of  the 
experience  of  every  employment  executive.  They  are,  therefore, 
used  here  only  to  emphasize  these  four  points:  fFirst,  that  there 
is  today  no  definite  agreement  as  to  how  much  work  is  to  be 
done  for  an  agreed  amount  of  pay;  second,  the  present  lack  of 
knowledge  about  work-content;  third,  the  essentially  dynamic 
and  changing  character  of  industrial  processes;  and  fourth,  the 
failure  to  pay  attention  to  the  effects  of  work  on  workers.")  Our 
illustrations  are  not  cited  here,  it  should  be  noted,  to  prove 
anything  one  way  or  the  other  about  limitation  of  output,  the 
installation  of  labor  saving  machinery,  or  the  shortcomings  of 
employers  or  workers.  These  questions  will  be  considered  in 
due  course.  We  are  rather  interested  to  show  how  this  fact  of 
change  in  process  and  this  need  of  knowledge,  must  bring  the 
technical  manager  and  personnel  manager  into  working  alliance. 


254  PERSONNEL  ADMINISTRATION 

Our  conclusion  can  for  brevity's  sake  be  reduced  to  two 
syllogisms : 

1.  Agreement  upon  terms  of  employment  should,  in  order  to 
assure  fair  treatment  to  every  interest,  include  agreement  upon 
the  meaning  and  content  of  a  fair  day's  (or  week's)  work. 

To  get  a  basis  for  such  agreement,  job  analysis  is  necessary. 

But  determination  of  the  management's  policy  as  to  terms  of 
employment  is  in  substantial  part  a  responsibility  of  the  per- 
sonnel administrator;  therefore, 

The  work  of  job  analysis  should  be  shared  by  him. 

2.  Changes  in  process  and  in  production  methods  are  con- 
stantly required  either  to  increase  production,  to  lower  costs,  to 
improve  quality  or  to  protect  the  health  of  the  worker.     There 
is  no  job  so  perfectly  standardized  today  that  it  would  not  lend 
itself  to  beneficial  changes  in  one  direction  or  another.     Changes 
in  process  are  inevitable. 

But  when  such  changes  come  they  almost  always  involve 
some  personnel  problem — either  in  the  acceptance  of  a  new  way 
of  doing  the  job,  in  which  case  training  is  necessary;  in  the 
shifting  of  workers  between  jobs;  in  the  substitution  of  a  machine 
for  workers;  or  in  some  other  way.  The  handling  of  the  person- 
nel aspects  of  the  change  in  process  or  method  is  an  important 
part  of  the  change — indeed,  after  a  certain  point  of  knowledge  as 
to  the  desirability  of  the  change  is  reached,  the  most  important 
part. 

Hence,  to  assure  successful  handling  of  the  transition,  the 
personnel  department  should  take  an  active  part  in  the  reaching 
of  decisions  about  changes  in  job  content  and  in  putting  them  into 
effect. 

It  is  essential  to  the  clarity  of  this  chapter  that  this  point  be 
firmly  established.  The  time  has,  of  course,  passed  when  em- 
ployment administration  can  be  conceived  as  an  extraneous 
appendage  of  the  management,  which  works  by  itself  on  separate 
and  unrelated  matters  vaguely  designated  as  "personnel  prob- 
lems." No  such  artificial  line  of  demarcation  exists.  Execu- 
tive work  either  contributes  to  the  task  of  economical  and 
efficient  production,  or  it  does  not.  The  work  of  production  has 
two  parallel  and  constantly  interrelating  aspects;  the  aspect  of 
plant  and  process;  and  the  aspect  of  people  as  applied  to  the  plant 
and  process.  And  until  corporations  are  ready  to  admit  that  the 
work  of  employment  administration  is  fundamentally  one  indis- 
pensable half  of  the  job  of  management,  they  will  miss  its  real 


JOB  ANALYSIS  AND  JOB  SPECIFICATIONS  255 

significance;  their  personnel  managers  will  be  ineffectual  in 
action,  and  will  be  subordinate  to,  rather  than  co-equal  with,  the 
manager  of  process. 

And  it  is  through  the  agency  of  job  analysis,  when  rightly 
conceived,  that  the  administrator  of  personnel  can  get  his  most 
natural  and  most  effective  liaison  with  the  administrator  who  is 
engrossed  in  technique  and  process.  How  this  can  come  about 
we  shall  presently  consider.  We  want  first  to  be  clear  that  the 
justification,  both  financially  and  from  the  point  of  view  of 
scientific  business  organization,  for  a  real  staff  personnel  execu- 
tive lies  in  his  ability  to  relate  his  efforts  directly  to  those  of  the 
technical  executive.  And  one  of  the  most  logical  points  at  which 
that  justification  can  be  established  is  in  the  work  which  job  analysis 
entails  and  implies. 

That  the  personnel  department  should  participate  in  job 
analysis  seems  to  us,  therefore,  an  inevitable  conclusion ;  and  the 
foregoing  discussion  of  its  uses  must  at  the  same  time  have  made 
clear  how  important  are  the  questions  with  which  we  are  here 
dealing.  We  come  next  to  consider  in  detail  what  job  analysis  is, 
the  purposes  for  which  such  study  is  needed,  the  facts  which  it 
should  include,  how  the  data  can  be  secured  and  how  applied. 

Definition. — What,  then,  is  job  analysis? 

Job  analysis  is  a  scientific  study  and  statement  of  all  the  facts 
about  a  job  which  reveal  its  content  and  the  modifying  factors  which 
surround  it.  The  job  is  the  molecule  of  industry;  and  what 
molecular  study  has  done  for  physics  and  chemistry,  job  study 
with  the  aid  of  every  possible  instrument  of  precision  can  begin 
to  do  for  industry.  Hence,  there  is  need  of  a  method  of  study 
for  a  job,  just  as  we  shall  presently  see  the  need  of  a  method  of 
factory  analysis.  Managers  need  to  know  what  elements  to 
consider  and  how  to  relate  them.  Job  analysis  if  it  is  to  be  scien- 
tific must  eventually  supply  a  systematic,  exhaustive,  orderly  and 
approximately  standardized  technique  of  procedure.  Already 
notable  advances  have  been  made,  but  the  work  is  still  in  the 
primary  stages.1 

The  ensuing  discussion  will  be  clearer  if  we  next  consider  the 

1The  Outline  of  Job  Analysis,  a  pamphlet  published  by  Valentine  & 
Gregg,  New  York,  1918,  is  the  most  comprehensive  attempt  at  an  all- 
round  procedure  which  has  come  to  our  attention.  Our  personal  association 
with  this  work  warrants  the  assertion  that  the  practical  uses  of  this  pro- 
cedure are  many,  and  the  results  obtained  from  its  use  of  significant  value 
in  laying  bare  the  subtleties  of  an  operation.  We  gratefully  acknowledge 
the  appreciable  assistance  of  this  pamphlet  in  the  preparation  of  this  chapter. 


256  PERSONNEL  ADMINISTRATION 

purposes  for  which  job  analysis  is  needed.  For  the  extent  of  any 
given  analysis  depends  upon  the  purpose  which  it  is  to  serve,  the 
uses  to  which  it  is  to  be  put.  If,  for  example,  the  employment 
office  wants  only  enough  data  for  the  drawing  up  of  a  job  specifica- 
tion, it  is  not  necessary  to  proceed  to  the  length  that  is  necessary 
if  workers  and  managers  are  attempting  to  agree  on  a  fair  day's 
work. 

Our  discussion  of  the  purposes  of  job  analysis  will  be  divided 
into  three  parts  in  order  to  indicate  the  values  of  its  use  to 
employers,  employees  and  the  public. 

Value  to  Employers. — (a)  To  standardize  an  operation.  For 
the  management,  job  analysis  is  needed  to  determine  the  best 
methods  of  carrying  on  a  j  ob  under  existing  conditions.  This  may 
be  desired  as  a  basis  for  planning,  scheduling  and  routing  the 
work  through  the  plant;  since  clearly  any  organization  of  the 
flow  of  work  cannot  be  perfected  until  the  time  of  each  operation, 
the  material  required,  the  sequence  of  the  process,  etc.,  are  known. 

It  is  this  aspect  of  job  analysis  which  was  first  popularized  by 
Frederick  W.  Taylor.  All  honor  is  due  to  him  for  insisting  upon 
the  necessity  of  knowing  the  content  of  a  job  if  truly  scientific 
management  is  to  be  installed.  Indeed,  all  subsequent  work  in 
this  field  is  built  upon  foundations  which  he  laid.  But  the  sub- 
sequent work,  although  from  one  point  of  view  it  may  seem 
relatively  slight,  is  of  pivotal  importance.  Taylor's  conception 
of  job  study  erred  on  the  side  of  too  great  objectivity;  that  is, 
study  of  the  job  as  an  entity  off  in  space  by  itself.  The  subjec- 
tive factors — the  attitudes,  opinions,  hopes  and  fears  of  the 
workers — were  not  sufficiently  taken  account  of;  nor  was  suffi- 
cient emphasis  placed  upon  the  effect  of  the  work  on  the  worker 
as  a  human  personality.  And  finally,  the  question  of  the  control 
and  application  of  the  accumulated  data  was  not  solved — or  even, 
it  may  fairly  be  said,  candidly  faced.  Nevertheless,  no  discus- 
sion of  job  analysis  is  complete  which  does  not  acknowledge  the 
pioneer  work  of  Mr.  Taylor  in  giving  substance  to  this  concept. 

Furthermore,  where  job  analysis  has  involved  the  use  of  the 
stop  watch,  there  has  been  a  development  of  technique  by  men 
more  or  less  closely  identified  with  the  Taylor  group  which  is 
elaborate,  systematic  and  painstakingly  scientific.  All  work  of 
job  study  is  thus  under  a  debt  to  those  who  have  elaborated  the 
time  study  technique  and  used  it  in  honorable  and  dispassionate 
fashion. 


JOB  ANALYSIS  AND  JOB  SPECIFICATIONS  257 

(6)  To  improve  an  operation;  that  is,  to  study  to  devise  ways 
and  means  of  doing  the  work  more  quickly  and  better — with  less 
effort,  less  fatigue,  less  cost.  Pioneer  work  has  been  done  here 
especially  in  relation  to  motion  study  and  fatigue  study.1  But 
here  again  the  tendency  has  been  to  be  too  objective,  not  taking 
the  worker  sufficiently  into  account  and  not  trying  to  get  from 
him  his  suggestions  as  to  improvements. 

Unquestionably,  one  of  the  most  potent  stimuli  to  job  research 
should  be  the  demand  for  higher  productivity.  It  is  here,  with 
the  dynamic  problem  of  proficiency,  productivity  and  low  unit 
costs,  that  job  analysis. gets  one  of  its  strongest  reasons  for  being; 
and  relates  itself  closely  to  production  and  to  personnel.  If  the 
attitude  which  the  factory  should  seek  to  encourage  in  relation 
to  process  and  people  is  one  of  growth,  development  and  improve- 
ment, the  practical  channel  through  which  that  attitude  should 
be  capitalized  is  job  analysis,  made  and  used,  of  course,  under 
those  fair  conditions  of  control  to  be  presently  discussed. 

(c)  To  define  responsibilities.     We  often  find,  as  every  consul- 
tant does,  that  there  is  extraordinary  confusion  as  to  responsi- 
bility over  jobs.     Study  should  determine  who  is  and  who  ought 
to  be  responsible  for  having  material  on   hand,   for  machine 
maintenance  and  repair,  for  removing  finished  material,  etc. 

(d)  To  provide  a  statement  of  sequence  of  operations  at  a  job. 
Training  cannot  be  carried  on  most  effectively  until  the  instructor 
knows  all  the  elements  in  the  operation  and  their  sequence,  and 
can  judge  whether  or  not  the  normal  order  of  procedure  at  a  job 
is  the  best  pedagogical  order.     If,  for  example,  the  first  thing  the 
worker  has  to  do  is  the  most  intricate  element  in  the  operation, 
he  should  not  usually  be  taught  that  first.     But,  in  any  case,  the 
instructional  value  of  seeing  a  job  in  its  constituent  parts  is  great, 
and  this  statement  of  sequence  of  operation  should  be  one  part 
of  the  finished  analysis. 

(e)  To  secure  the  data  on  which  to  draw  up  a  job  specification. 
It  is  useful  to  know  what  the  demands  of  a  job  are  upon  the  worker 
in  point  of  training,  aptitude,  temperament,  and  in  fact  all  the 
necessary  qualifications. 

1  See  GILBRETH,  FRANK  B.  Motion  Study,  Fatigue  Study,  Applied 
Motion  Study.  See  also  P.  SARGANT  FLORENCE.  Use  of  Factory  Statis- 
tics in  the  Study  of  Industrial  Fatigue.  Also  Report  of  U.  S.  Public  Health 
Service,  How  Industrial  Fatigue  May  be  Reduced.  Wash.  Govt.  Print. 
Off.,  1918,  12  p.  (Reprint  No.  482.) 
17 


258  PERSONNEL  ADMINISTRATION 

(/)  To  know  the  amounts  of  output  produced  by  workers  of 
different  degrees  of  skill.  As  we  shall  see  presently,  this  data 
can  be  of  great  help  in  narrowing  the  range  of  the  discussion  as 
to  how  much  work  should  be  expected  in  a  given  period. 

(g)  To  know  the  effects  of  work  on  workers.  It  is  essential 
for  industry  and  for  the  community  that  we  get  more  adequate 
records  of  the  effects  of  work  on  the  worker,  in  relation  to  fatigue, 
special  strain,  accident,  occupational  disease,  occupational  neu- 
rosis, predisposing  causes  to  non-occupational  ills,  etc. 

The  immediate  value  of  discovering  ill  effects  of  work  will 
show  in  reduced  labor  turnover  and  in  a  more  cordial  working 
spirit.  There  is,  moreover,  a  crying  social  need  for  such  material 
as  a  basis  for  legislation  and  state  regulations. 

(h)  To  coordinate  all  jobs  more  soundly.  On  a  basis  of  knowl- 
edge of  successive  jobs,  problems  dealing  with  cooperation 
between  departments,  gaps  in  responsibility,  inadequate  inspec- 
tion and  other  features  of  bad  coordination  can  be  discussed  and 
solved. 

Value  to  Workers. — (a)  To  make  work  run  more  smoothly 
and  easily.  For  the  workers  job  analysis  is  of  value  in  helping 
to  assure  a  well-organized  flow  of  work.  This  is  the  obverse 
of  the  statement  that  proper  coordination  and  clear  assignment 
of  responsibility  benefit  the  employer.  If  the  worker,  especially 
on  piece  work,  has  to  wait  for  material,  or  if  it  comes  to  him  in 
bad  form  or  with  defective  workmanship,  it  increases  appre- 
ciably the  difficulties  and  unnecessary  annoyances  of  his  own 
job. 

(6)  To  increase  productivity  and  thus  increase  the  workers' 
earning  power.  This  statement  must  be  made  with  caution  and 
with  the  reservation  that  job  analysis  will  not  necessarily  have 
the  effect  of  increasing  the  workers'  immediate  earnings  unless  the 
use  of  the  analysis  is  under  joint  control.  But,  as  the  1919  annual 
report  of  the  American  Federation  of  Labor  points  out,  such  study 
is  needed  since  "the  increased  productivity  resulting  from 
scientific  research  is  a  most  potent  factor  in  the  ever-increasing 
struggle  of  the  workers  to  raise  their  standards  of  living,  and  the 
importance  of  this  factor  must  steadily  increase  since  there  is  a 
limit  beyond  which  the  average  standard  of  living  of  the  whole 
population  cannot  progress  by  the  usual  methods  of  readjustment, 
which  limit  can  only  be  raised  by  research  and  the  utilization  of 
the  results  of  research  in  industry."  This  resolution  points  un- 


JOB  ANALYSIS  AND  JOB  SPECIFICATIONS  259 

erringly  to  the  simple  yet  fundamental  economic  truth  that  more 
cannot  be  divided  than  is  produced.  After  a  certain  point  in 
increased  earnings  of  workers  is  reached  (under  any  system  of 
ownership),  further  enlargements  entail  greater  production. 
And  we  are  not  without  evidence  that  even  under  the  present 
system  of  ownership,  there  will  universally  be  greater  comfort 
if  there  are  more  goods  to  distribute. 

(c)  To  show  the  effects  of  work  on  the  workers.     As  a  necessary 
measure  of  self -protection  workers  should  have  all  the  knowledge 
possible  about  the  physical  effects  of  work;  so  that  they  may 
be  better  able  to  demand  a  reasonable  length  of  working  day 
and  week,  protection  at  work  by  better  conditions  and  protec- 
tive devices,  and  elimination  of  special  fatigue  or  occupational 
disease  hazards. 

(d)  To  give  a  fact  basis  for  agreement  with  the  employer  OP 
fair  amounts  of  output. 

This  is  really  the  same  as  (/)  above.  All  facts  as  to  how  much 
work  is  done  and  can  be  done,  which  will  narrow  the  discussion 
as  to  how  much  work  ought  to  be  done  for  a  given  amount  of 
pay,  will  help  to  put  all  the  cards  on  the  table,  save  time  and 
temper,  and  assure  a  more  scientific  decision. 

Value  to  the  Public  and  Consumers. — (a)  To  get  data  on  which 
they  can  help  to  settle  disputes  between  managers  and  workers. 

The  public  and  the  consumers  are  rendered  impotent  by  igno- 
rance. In  so  far  as  arbitration  is  a  public  function,  it  can  be  pur- 
sued intelligently  only  as  all  the  facts  about  the  job  in  question 
are  accessible.  Analyses  obtained  by  the  use  of  scientific  methods 
could  supply  this  data,  if  only  properly  constituted  public  bodies 
were  available  to  do  the  research  work. 

(6)  To  get  data  on  which  to  help  to  set  up  universal  protective 
standards. 

It  is  only  as  we  have  the  facts  as  to  injurious  effects  of  work  on 
workers  that  we  can  get  legislative  bodies  to  work  most  rapidly 
in  enacting  hours-of -labor  legislation,  safety  and  sanitation  laws, 
etc.  The  briefs  of  the  National  Consumers'  League  in  behalf  of 
the  eight  hour  day,  abolition  of  night  work,  and  a  minimum  wage, 
are  the  most  advanced  attempts  to  mass  relevant  knowledge 
thus  far  available ;  but  we  can  confidently  assume  that  a  greater 
and  more  specific  body  of  material  secured  from  actual  job  analyses 
will  provide  even  more  formidable  arguments  for  the  conscien- 


260  PERSONNEL  ADMINISTRATION 

tious  consumer  to  use  in  his  efforts  to  establish  wholesome  indus- 
trial standards. 

(c)  To  give  publicity  to  unwholesome  conditions. 

Publicity  regarding  conditions  and  terms  of  employment  at 
jobs  which  are  "affected  with  a  public  interest"  (and  what  jobs 
are  not?)  vacillates  between  muck-raking  and  dull  statistical 
abstracts.  A  properly  drawn  job  analysis  should  serve  as  a 
model  for  the  kind  of  scientific  yet  pitiless  publicity  which  it 
should  be  possible  to  obtain  where  conditions  are  especially  in 
need  of  correction.  The  therapeutic  value  of  publicity  is  so 
great  that  communities  should  be  able  to  make  use  of  some 
instrument  at  once  graphic  and  accurate.  Job  analysis  should 
be  this  instrument. 

We  have  established,  it  would  seem,  a  strong  case  in  behalf 
of  job  analysis  for  a  variety  of  useful  purposes.  In  the  present 
study  we  shall  tend  to  confine  the  discussion  to  problems  arising 
where  the  management  takes  the  initiative  introducing  it — not 
through  desire  to  minimize  the  workers'  or  public's  interest  in 
job  analysis — but  simply  because  of  the  limitations  imposed  by 
the  purpose  of  the  present  volume.  The  next  question,  is,  there- 
fore: What  is  the  subject  matter  and  the  topics  which  the 
analysis  should  cover  if  the  several  uses  of  it,  as  above  stated, 
are  to  be  made?  For  a  rounded  job  analysis  is  obviously  a  body 
of  knowledge  from  which  many  special  subjects  can  be  developed, 
a  quarry  of  information  from  which  facts  can  be  extracted  for 
several  purposes. 

Content  of  the  Job  Analysis. — The  matter  to  be  included  in 
a  job  analysis  may  be  conveniently  divided  for  purposes  of  clear 
statement  and  ready  reference  into  several  topics.  The  discussion 
of  these  topics  contained  in  the  job  analysis  as  initially  drawn 
up  is  confined  to  a  statement  of  facts.  It  will  eventually  be  desir- 
able to  draw  certain  conclusions  from  these  facts  and  to  make 
certain  recommendations  as  to  advisable  changes.  The  sub- 
jects to  be  treated  in  the  job  analysis  may  be  grouped  under 
the  following  headings: 

The  Job  Itself 

Qualifications  Necessary  in  the  Worker 

Sequence  of  Operations 

Effects  of  the  Job  on  the  worker 

Relation  of  the  Job  to  the  Organization 

Relation  of  the  Job  1<>  the  Community 


JOB  ANALYSIS  AND  JOB  SPECIFICATIONS  261 

The  Job  Itself. — Under  this  head  the  relevant  information 
regarding  the  actual  content  of  the  job  is  included.  It  may  con- 
veniently be  subdivided  as  follows: 

1.  General  Description. — This  should  be  a  brief  word  picture 
of  the  job  as  a  whole  and  its  relation  to  the  other  processes.     It  is 
desirable  to  have  this  accompanied  by  photographs  of  the  job 
in  operation. 

2.  Machinery. — Under  this  head  the  machinery  at  the  job 
should  be  described  and  the  necessary  questions  answered  as  to 
how  it  is  maintained,  etc.1 

3.  Tools  and  Equipment. — It  is  necessary  to  know  all  tools  and 
special  equipment   (such  as  boots,  aprons,  goggles,  etc.)  which 
are  used  at  the  job;  also  how  these  are  provided  and  maintained. 

4.  Materials. — Especially  important  is  it  to  determine  whether 
materials  are  (a)  in  the  right  place;  (&)  in  the  right  condition;  (c) 
at  the  right  time;  and  (d)  in  the  right  quantity;  and  whether  (e) 
they  are  properly  removed. 

5.  Motions. — What    are   the    motions?     Are  they  necessary? 
Are  they  the  best?     In  order  to  answer  these  questions  with 
scientific  accuracy  it  may  in  some  cases  be  necessary  to  have  ac- 
cess to  the  kind  of  apparatus  devised  by  Mr.  F.  B.   Gilbreth.2 

In  this  connection,  too,  it  is  important  to  consider  the  char- 
acteristic postures  required  for  the  work;  and  the  parts  of  the 
body  most  used. 

6.  Times. — Under  this  head  should  be  stated  all  the  facts 
about  hours  and  working  periods  which  we  have  discussed  in 
Chapter  VII.     Also  the  results  of  actual  elementary  time  studies 
with  the  stop-watch;  analysis  of  the  time  allowances  for  rest, 
delays,  use  of  toilets,  etc.;  and  recommended  over-all  times  for 
the  job  by  (a)  the  best  workers;  (6)  the  good  workers;  (c)  the 
medium  run  of  workers;  and  (d)  learners  or  apprentices. 

This  will  be  one  of  the  critical  chapters  in  the  analysis,  espe- 
cially if  the  purpose  is  to  get  data  which  will  serve  as  a  basis 
for  subsequent  agreement  with  workers  regarding  a  fair  day's 
work. 

7.  Records. — It  is  important   to  know  what  records  there  are 
regarding   the  job — records  of  quantity  and  quality  of  output, 
amounts  of  waste  and  seconds  and  rejects,  unit  costs,  machine 

1  For  suggestive  detail  as  to  questions  under  all  the  topics  to  be  covered 
see  Tead  &  Gregg,  Outline  of  Job  Analysis. 

2  See  his  Motion  Study. 


262  PERSONNEL  ADMINISTRATION 

hours  in  operation,  power  consumption,  etc.  It  is  further 
valuable,  as  we  showed  in  Chapter  XV,  to  state  what  access 
employees  on  the  job  have  to  these  records,  and  in  what  ways 
they  could  be  so  compiled  as  to  increase  the  worker's  interest. 

8.  Standards  of  Output. — This  phrase  is  used  to  express  the 
maximum  output  which  it  would  be  possible  to  obtain  with  pres- 
ent machinery  under  the  best  available  shop  conditions  and  shop 
organization.    Our  experience  shows  that  it  is  always  useful  for 
the  whole  organization  to  know  what  output  a  job  could  show  if 
all  surrounding  conditions  were  kept  as  right  as  is  humanly  pos- 
sible.    This  supplies  a  standard  for  the  organization  to  work  to- 
ward.   It  should  not  supply  a  "pace"  or  "task"  or  a  basis  of 
piece-price  fixation ;  for  it  is  not  the  worker  alone  who  can  contri- 
bute to  the  approximating  of  this  ideal  standard.     The  quality 
of  the  material  must  be  right;  the  machinery  in  smooth  running 
order;  the  material  delivered  in  correct  manner;  conditions  of 
light,  ventilation,  etc.,  satisfactory;  the  workers  carefully  selected, 
etc.     And  to  assure  these  conditions  able  management  is  essential. 

This  standard  is,  we  repeat,  based  on  a  utilization  of  existing 
machinery  and  equipment.  The  analysis  required  to  determine 
it  may,  and  often  will,  show  the  possibilities  in  new  machinery 
and  processes;  but  at  any  given  time  a  standard  will  indicate  the 
potentialities  of  the  going  enterprise.  It  should  offer  an  objective 
for  improved  plant  efficiency. 

9.  Amounts  of  Output. — The  only  fair  basis  for  a  decision  as 
to  the  amount  of  work  to  be  expected  in  a  given  time  is  the  rate 
of  output  under  existing  conditions.     (Of  course,  as  those  condi- 
tions are  corrected  or  improved,  the  amounts  of  work  will  change 
also.) 

It  should  always  be  borne  in  mind  in  discussing  this  problem 
that  it  has  two  separable  although  related  aspects.  First,  there 
is  the  amount  of  work  which  in  a  week  of  a  given  number  of 
hours,  workers  of  different  degrees  of  skill  may  be  expected  to  do. 
This  is  discussed  in  the  present  chapter.  And,  second,  there  is  the 
question  of  the  amounts  of  pay  they  are  to  receive  for  that  work ; 
which  is  discussed  in  Chapter  XXIV.  It  is  our  conviction  that 
useless  and  endless  misunderstanding  and  confusion  ulx)ut  work 
and  pay  will  be  removed  only  when  industry  is  prepared  to  enter 
upon  a  study  of  these  as  separate  problems.  The  first — determin- 
ation of  work — is  a  problem  largely  (although  not  wholly)  in  the 
realm  where  science  and  exact  knowledge  can  throw  clear  light; 


JOB  ANALYSIS  AND  JOB  SPECIFICATIONS  263 

the  other — agreement  about  pay — is  largely  in  the  realm  where 
the  securing  of  a  temporary  equilibrium  of  economic  forces  and 
interests  is  the  determining  consideration* 

In  the  study  of  amounts  of  work  it  is  important  to  know  the 
quantity  of  output  at  the  same  operation  by  workers  of  different 
degrees  of  competence.  While  a  differential  in  pay  for  differences 
in  competence  at  a  job  is  not  under  all  conditions  an  essential 
feature  of  a  sound  payment  plan,  we  are  inclined  to  favor  it — 
provided  it  is  used  under  the  proper  conditions  of  control  discussed 
in  the  next  chapter  and  in  Chapter  XXIV.  And  in  order  to  de- 
termine this  differential  on  its  work  side,  data  should  be  available 
not  simply  to  show  an  "average  output,"  but  to  show  over  as 
long  a  period  as  will  give  comparable  results,  the  output  of  all 
the  workers. 

10.  Pay. — The  hourly  or  piece  rate,  the  weekly  wages  and  the 
annual  earnings  should  be  stated  here ;  also  all  factors  which  enter 
into  determination  of  wages — such  as  length  of  service,  age  of 
worker,  cost  of  living,  etc. 

Qualifications  Necessary  in  the  Worker. — This  section 
should  include  a  statement  of  the  general  and  particular  mental 
and  physical  characteristics  and  special  abilities  which  the  job 
calls  for. 

Sequence  of  Operations. — This  is  a  simple  written  state- 
ment in  chronological  order  of  the  motions  and  activities  required 
in  carrying  out  the  job.  It  is  in  effect  a  standard  practice  sheet. 

Effects  of  the  Job  on  the  Worker. — This  is  a  statement  of 
the  physiological,  psychological  and  moral  effects  of  the  work  on 
the  worker  in  so  far  as  they  are  discoverable  from  records, 
observation,  personal  inquiry,  etc. 

Accident  and  sickness  records,  records  of  periodic  physical 
examinations  of  workers  at  the  job,  records  showing  distribution 
in  quantity  of  production  through  the  day  and  week,  labor 
turnover  records  for  the  job,  length  of  service  records,  absence 
and  lateness  records;  all  these  will  tell  something  of  the  effect  of 
the  work. 

Relation  of  the  Job  to  the  Organization. — In  this  section 
the  job  analyst  will  consider  the  foreman's  connection  with  the 
job,  the  coordination  of  the  flow  of  work,  the  reflection  of  general 
policies  like  sales  and  finance  upon  the  job,  the  general  working 
conditions  and  service  equipment,  and  any  other  related  factors, 
not  inherent  in  the  job  itself. 


264  PERSONNEL  ADMINISTRATION 

Relation  of  the  Job  to  the  Community. — It  will  occasionally 
be  necessary  to  swing  out  into  the  wider  arc  of  the  community 
to  discover  contributing  causes  which  affect  the  job.  Where 
such  factors  play  an  important  part,  a  full  understanding  of 
the  job  makes  their  statement  imperative  for  scientific 
thoroughness. 

Job  Specifications. — The  principal  derivative  from  job  analysis, 
which  it  is  useful  to  discuss  further,  is  job  specification.  Our 
discussion  of  selection  assumed  that  this  specification  was  in 
the  hands  of  the  interviewer,  and  obviously  it  is  important  to 
consider  what  information  the  interviewer  needs  in  order  to  make 
his  work  most  successful. 

Careful  study  of  existing  and  proposed  forms  leads  us  to  suggest 
the  following  topics  as  necessary  for  consideration  on  most  job 
specification  cards.  From  such  a  list,  the  special  qualifications 
which  it  is  requisite  to  check  for  any  one  job  can,  with  a  little 
study,  be  selected. 

The  job  specification  form  should  show: 

A.  Qualifications  Necessary  in  Worker 

1.  Physical  Qualifications 

Age  Sensitiveness  of  hands 

Height  Hearing 

Sex  Sight 

Length  of  arms  and  legs  Cleanliness 

Size  of  hands  and  fingers  Part  of  body  most  used 

2.  Mental  Qualifications 
Education 

Previous  experience  required 
'•»          Ability  to: 

Speak  English  Read  to  scale 

Read  English  Use  gauge 

Write  neatly  Use  micrometer 

Calculate  Set  up  work 
Read  blueprints 
Type  of  mind:1 

Mental  Manual 

Settled  Roving 

Indoor  Outdoor 

Directive  Dependent 
Large  dimension  worker       Small  dimension  worker 

Adaptable  personality  Self-centered  personality 

Deliberate  Impulsive 

Dynamic  Static 

1  See  SCHNEIDER,  HERMAN.  National  Association  of  Corporation 
Schools,  Bulletin  No.  7,  1917. 


JOB  ANALYSIS  AND  JOB  SPECIFICATIONS  265 

B.  Nature  of  Work 

Name  of  job  Quick 

Name  of  machine  Slow 

Name  of  foreman  Rough 

Heavy  Finish 

Medium  Coarse 

Light  Fine 

Bench  Exacting 

Bench  machine  Repetitive 

Trucking  Varied 
Accident  hazard 
Location  of  job 

C.  Conditions  of  Work 

Standing  Greasy 

Sitting  Permanent 

Walking  Temporary 

Stooping  Overtime 

Clean  Humid 

Dirty  Hot 

Wet  Cold 

Dusty  Fumes 

Odorous  Acids 

D.  Length  of  Time  to  Learn 

E.  Rapidity  of  Advancement  and  Chance  for  Promotion 

F.  Terms  of  Employment 

Starting  rate 

Regular  rate:  P.  W.  or  D.  W. 

Average  weekly  earnings 

Hours  per  day 

Hours  per  week 

Expected  amounts  of  work 

G.  Methods  of  Measuring  Individual  Progress  at  the  Job 

For  purposes  of  presentation  to  the  worker,  the  check-up  of 
these  items  should  constitute  an  understatement  of  the  job's 
possibilities  rather  than  the  reverse. 

The  content  of  the  specification  itself  can  usefully  become 
subject  for  the  consideration  of  the  job  analysis  committee, 
although  once  that  committee  has  approved  the  finished  analysis 
there  will  be  few  points  in  the  specification  not  already  previously 
agreed  to.  The  benefit  of  this  conference  will  rather  be  the 
indirect  educational  one  of  having  the  workers  at  each  job  realize 
that  there  exists  a  defined  body  of  standards  for  admission  to  that 
job.  And  it  will  be  helpful  for  ambitious  workers  to  be  able  to 
learn  the  necessary  qualifications  for  jobs  to  which  they  aspire 
and  for  which  they  desire  to  equip  themselves. 
Selected  References. 

(See  end  of  following  chapter) 


CHAPTER  XIX 
THE  SUPERVISION  AND  CONTROL  OF  JOB  ANALYSIS 

If  the  data  necessary  to  make  the  job  analysis  a  serviceable 
instrument  has  now  been  correctly  enumerated,  we  should  next 
consider  how  it  can  be  most  readily  and  accurately  secured  and 
utilized.  These  two  tasks  cannot  in  practice  be  separated.  For 
the  work  of  getting  facts  to  which  all  the  interested  parties  will 
agree,  and  the  subsequent  work  of  using  agreed  facts  as  the 
basis  for  securing  agreement  upon  those  working  terms  which 
the  analysis  has  tentatively  proposed,  are  two  halves  of  one 
project. 

The  "utilizing"  of  job  analysis  is  fundamentally  the  using  of 
its  fact  data  to  obtain  practical  standards  regarding  amounts 
of  work  to  be  done  at  a  job,  its  quality,  standards  of  cost  and 
wastage,  and  working  hours  and  periods. 

And  the  "adopting"  of  job  analysis,  which  we  shall  presently 
discuss,  means,  in  our  use  of  the  term,  the  formal  acceptance  by 
the  interested  parties  (1)  of  the  facts,  (2)  of  standards  on  the 
above  four  items,  and  (3)  of  those  standards  (or  modifications  of 
them)  as  the  basis  of  the  working  contract. 

It  seems  clear  that  these  tasks  of  study,  agreement  and  accept- 
ance will  be  most  safely  and  soundly  carried  on  if  the  directly 
interested  parties  all  take  a  hand  in  the  reaching  of  decisions. 
This  implies,  of  course,  that  the  workers  themselves  will  in  some 
way  have  a  voice  in  the  study — a  conclusion  which  has  much 
significance  and  deserves  careful  scrutiny. 

Enough  has  l>een  said  to  show  that  certain  of  the  facts  in  the 
analysis  could  be  used  to  the  detriment  of  the  workers;  could  be 
used  as  a  basis  for  more  systematic  exploitation;  could  be  used  to 
increase  the  insecurity  and  monotony  of  their  work. 

Workers  have  always  tended  to  resent  attempts  to  deprive 
them  of  their  monopoly  of  craft  knowledge  by  putting  it  into 
writing,  and  by  modifying  operations  in  the  interest  of  more 
rapid  training  or  performance.  They  have  feared  studies  of 
output  because  of  the  familiar  experience  of  speeding  up  and 

JM) 


•  .       SUPERVISION  AND  CONTROL  OF  JOB  ANALYSIS       267 

rate-cutting.  They  have  feared  studies  which  would  lead  to 
labor-saving  innovations  because  frequently  this  has  resulted  in 
unemployment  for  some  of  their  number.  Job  analysis  made 
by  management  and  in  the  exclusive  interest  of  management 
they  fear;  and  they  are  justified  in  fearing  it. 

But  job  analysis  is  not  properly  a  device  of  exploitation.  It 
is  rather  an  instrument;  an  instrument  of  precision;  an  instru- 
ment for  the  gaining  of  exact  knowledge.  Like  any  other  in- 
strument it  may  be  abused.  The  fine  edge  of  the  surgeon's  knife 
makes  of  it  an  excellent  weapon  for  the  murderer;  but  the  world 
does  not  hold  that  against  surgeons'  knives.  And  of  job  analysis 
we  can  confidently  say  that  its  use  is  essential;  but  that  genuine 
social  benefit  will  come  out  of  it  only  when  there  is  joint  control 
by  workers  and  managers  (and  eventually  by  the  public  as  well) 
both  in  the  making  of  the  analysis  and  in  its  application.  Used 
jointly  as  a  basis  for  inquiry  and  as  a  basis  for  adjustment  of 
differences  over  amounts  of  work  and  pay,  job  analysis  can  bring 
knowledge  and  insight  into  play  where  prejudice  and  opinion 
have  heretofore  dominated.  But  used  by  the  management  alone, 
it  at  once  creates  risks  for  the  management  and  dangers  for  the 
workers.  Whenever  in  this  volume  we  urge  the  crucial  impor- 
tance of  job  analysis,  it  should  be  distinctly  understood,  therefore, 
that  we  mean  job  analysis  under  joint  control.  This  statement 
will  serve  also  to  make  clearer  our  reasons  for  believing  that  the 
conduct  of  job  analysis  is  logically  a  function  in  which  the  per- 
sonnel department  should  share.  Job  analysis  stands  at  the 
vital  cross-roads  where  technical  and  personnel  facts  meet  and 
interpenetrate. 

This  being  so,  the  logical  place  for  employee  cooperation  and 
group  action  to  take  place  is  at  this  cross-roads.  If  the  manage- 
ment wants  interest  in  work,  if  it  is  dissatisfied  with  quality,  if  it 
feels  cheated  on  the  quantity  of  work  done — the  place  to  attack 
these  problems  is  at  the  point  where  knowledge  and  intelligence  can 
offer  the  basis  for  common  discussion,  agreement  and  joint  action. 
We  do  not  say  that  shop  committees  should  necessarily  first 
consider  the  problems  that  center  around  job  analysis.  But  the 
shop  committee  that  is  to  interest  itself  in  matters  of  fundamental 
importance  will  have  to  concern  itself  sooner  or  later  with  such  study. 

Moreover,  when  a  company  has  reached  the  point  where  it 
really  sees  the  necessity  of  job  analysis  to  bring  its  production 
organization  up  to  concert  pitch  or  to  keep  it  there,  the  time  has 


268  PERSONNEL  ADMINISTRATION 

by  that  token  come  when  the  manual  workers  should  be  con- 
sulted. And  the  carrying  on  of  the  job  analysis  and  the  applying 
of  its  findings,  form  the  sensible  and  invaluable  subjects  upon 
which  that  consultation  should  occur.  It  is  only  as  employee 
organizations  interest  themselves  in  job  analysis,  and  as  progres- 
sive managers  take  the  workers  into  camp  on  problems  of  job 
standards,  that  there  exists  any  organic  unity  in  the  pro- 
duction mechanism.  There  is  much  loose  talk  about  "coopera- 
tion" in  industry.  But  there  is  one,  and  perhaps  only  one,  kind 
of  cooperation  which  is  essential — since  without  it  goods  are  not 
efficiently  made.  That  is  the  cooperation  of  managers  and  man- 
ual workers  to  get  out  an  agreed  amount  of  product  of  an  agreed 
quality  at  an  agreed  cost  within  an  agreed  time.  There  may  be 
friction,  delay,  divergence,  controversy  over  what  is  to  be  agreed. 
But  once  that  agreement  is  reached,  and  as  soon  as  it  is  reached, 
hearty  cooperation  becomes  a  valid  objective. 

There  will  surely  be  doubt  in  some  minds,  however,  about  the 
wisdom  of  giving  employees  a  voice  in  the  work  of  job  study. 
This  objection  is  one  which  we  have  no  disposition  to  ignore.  We 
are,  of  course,  assuming  that  the  analysis  is  to  be  secured  not 
only  in  order  to  have  certain  information  on  hand,  but  to  afford 
a  basis  for  agreement  as  to  improvements  in  process  and  as  to 
amounts  of  work  to  be  done  at  a  job  in  a  specified  time.  If  this  is 
the  case,  there  are  certain  attendant  values  in  having  the  workers' 
participation  to  which  it  is  essential  to  call  attention. 

First,  the  workers  must  know  that  such  study  is  contemplated 
and  know  how  it  is  to  be  used.  As  already  pointed  out,  suspicion 
will  be  at  once  aroused  if  they  are  not  taken  honestly  and  com- 
pletely into  the  management's  confidence  from  the  start.  This 
can  be  naturally  and  helpfully  done  only  in  a  meeting  with  those 
at  the  job,  at  which  the  whole  implication  of  job  analysis  is 
made  clear  to  them  and  they  are  then  asked  to  select  represen- 
tatives to  consider  the  study  further. 

Second,  they  have  information  about  the  job  which  no  one 
else  has.  And  there  is  no  way  to  get  this  short  of  having  them 
present  in  the  councils. 

Third,  the  workers'  interest  is  arousod  by  the  new  point  of 
view  and  new  problems  to  which  job  analysis  calls  attention. 
The  job  analysis  conferences  should  be  one  of  the  most  interest- 
provoking  occurrences  in  the  entire  operation  of  the  factory. 

Fourth,  workers  will   agree  to  adopt  a  standard  sequence  of 


SUPERVISION  AND  CONTROL  OF  JOB  ANALYSIS        269 

operations  only  as  they  are  convinced  and  agree  that  the  standard 
way  is  the  best  way  for  them  to  do  the  job. 

Fifth,  workers  will  agree  to  the  amount  decided  upon  as  a 
fair  day's  work  only  as  they  have  a  hand  in  determining  it. 
Experts  can  compile  figures  about  a  fair  day's  work  till  doomsday 
but  until  workers  agree  to  do  certain  amounts  of  work,  production 
will  tend  to  fall  far  below  management  expectations.  We 
should  always  remember  that  within  limits  it  is  in  any  case  the 
workers  who  determine  the  amount  of  output.  Managements 
may  think  the  output  less  than  a  fair  return  for  the  day's  pay. 
Workers  may  think  their  output  more  than  they  are  getting  paid 
for.  Frequently  that  is  the  situation;  and  it  exhibits  the  two 
parties  at  complete  cross-purposes.  As  a  result,  the  amount 
which  the  rank  and  file  of  the  shop  tacitly  agree  to  perform  as 
a  day's  work  becomes  the  normal  day's  output. 

And  all  that  we  are  here  proposing  is  that  this  negotiation  about 
the  amount  of  work  be  consciously  undertaken  and  organized,  with 
both  sides  in  possession  of  the  facts;  rather  than  be  covert,  under- 
ground and  unacknowledged  as  an  issue,  as  it  usually  is  today. 
When  both  sides  know,  and  know  that  both  sides  know,  what 
men  of  different  degrees  of  competence  can  fairly  do  in  a  day  or 
week,  the  effort  to  agree  as  to  how  much  they  will  do,  is  a 
much  less  difficult  undertaking. 

indeed^,  the  next  great  step  ahead  in  the  more  effective  organization 
of  industry  is  collective  bargaining,  first  about  work  and  second  about 
pay.  The  objection  will  naturally  be  urged  here  that  if  in  the 
last  analysis  the  amount  of  work  is  to  be  bargained  about  openly, 
there  is  no  value  in  an  extensive  study  of  the  facts,  since  the  de- 
termining factor  will  be  the  relative  bargaining  power  of  the  parties 
at  interest.  It  should  be  clear,  however,  that  there  are  degrees 
of  intelligence  in  bargaining,  degrees  of  wisdom  in  claims  and 
counter-claims,  degrees  of  expediency  in  demands.  Since  this 
is  true,  and  apparently  always  will  be,  the  value  of  job  analysis 
as  a  basis  for  bargaining  is  not  only  substantial — it  is  becoming 
today  indispensable. 

Sixth  and  finally,  all  the  facts  established  in  the  job  analysis 
are  not  capable  of  exact  statistical  measurement.  Matters  of  opin- 
ion must  sometimes  necessarily  have  weight;  and  wherever  this  is 
true,  the  opinion  of  those  most  directly  involved — the  workers 
— is  certainly  important,  perhaps  even  more  important  than  that 
of  anyone  else. 


270  PERSONNEL  ADMINISTRATION 

There  are,  therefore,  fundamental  reasons  for  having  the 
workers  "in  on  the  ground  floor"  when  the  job  analysis  is  being 
made.  And  only  as  they  are  a  party  to  it,  are  they  a  party  to 
the  really  vital  decisions  of  the  plant  which  affect  them.  The 
consent  of  the  workers,  if  it  is  to  be  secured  at  all,  starts 
at  this  point  where  methods  and  amounts  of  work  are  decided. 
And  because  this  is  true,  it  is  at  this  point  also  that  the  springs  of 
interest  in  work  are  genuinely  tapped. 

The  Machinery  of  Control. — Part  of  the  objection  to  joint 
control  of  job  analysis  arises  from  a  misconception  of  the  part  the 
workers  will  play  in  it.  We  shall,  therefore,  next  consider  the 
machinery  of  control  and  the  machinery  of  execution.  The 
validity  of  the  case  for  some  more  or  less  definitely  organized 
group  which  will  have  the  supervision  of  job  analysis  as  its  func- 
tion, seems  to  us  clear.  Yet  our  proposal  in  this  connection 
is  to  be  taken  as  suggestive  rather  than  as  a  fixed  and  static 
scheme  of  structure.  If,  then,  it  is  agreed  that  the  vitally 
interested  parties  should  get  together  when  any  job  is  being 
studied,  will  not  the  following  functionaries  be  involved? 

(a)  A  representative  of  the  technical  management. 

(b)  A  representative  of  the  personnel  management. 

(c)  A  representative  of  the  head  of  the  department. 

(d)  One  or  more  representatives  of  the  workers  at  the  job  in  question. 
(d)  A  representative  of  the  employees  as  a  whole. 

The  inclusion  of  each  of  these  representatives  is  determined 
by  his  having  a  special  interest,  point  of  view  and  knowledge. 
Job  analysis  which  is  to  be  accurate  in  every  particular  must,  we 
have  seen,  include  the  material  available  from  every  quarter — 
and  there  is  usually  need  for  formal  representative  conference  in 
order  that  the  different  parties  may  actually  check  each  other  up 
on  the  spot  and  get  the  educational  values  which  such  an  in- 
terchange inevitably  affords. 

We  propose  that  this  group  be  known  as  the  Job  Analysis 
Committee,  and  that  the  work  of  supervising  the  job  study  and  of 
finally  "adopting"  the  analysis  lx»  delegated  to  it.  The  actual 
work  of  observation,  analysis  of  records,  and  the  initial  compila- 
tion will  then  be  largely  in  the  hands  of  a  job  analyst  whose  work 
we  shall  presently  consider. 

But  a  further  objection  is  likely  to  appear  at  this  point:  Our 
proposal  involves  the  creation  "of  just  one  more  committee." 
"They  will  spend  so  much  time  discussing,"  it  may  be  said, 


SUPERVISION  AND  CONTROL  OF  JOB  ANALYSIS       271 

"there  will  be  no  time  left  to  work."  There  is  no  doubt  an  ele- 
ment of  truth  in  this  objection.  But  it  is  becoming  clearer  as 
the  world's  experience  with  representative  institutions  grows 
that  a  part  of  the  price  of  honestly  representative  government  is  the 
consumption  of  sufficient  time  in  conference  to  enable  the  representa- 
tives to  get  at  the  facts,  compose  their  differences  and  decide  upon  a 
course  of  action.1  If  it  is  said  that  in  industry  this  is  too  high  a 
price  to  pay,  the  answer  is  that  without  it  the  consent  of  the 
workers  will  be  a  reluctant  consent  and  their  interest  will  not  be 
aroused.  Fundamentally,  efficiency  depends  upon  interest  and 
consent.  And  job  analysis  under  joint  guidance  instead  of 
meaning  merely  one  more  committee  is  the  indispensable  technical 
instrument  for  assuring  that  efficiency.  There  may  indeed  be  too 
many  committees;  but  if  there  has  to  be  a  choice,  the  committee 
on  job  analysis  is  the  one  which  the  progressive  plant  can  least 
afford  to  drop. 

The  Job  Analyst. — In  large  plants  there  will  be,  as  a  joint 
division  of  the  production  and  personnel  departments,  a  research 
bureau.  And  the  members  of  this  bureau  will  be  the  job  analysts, 
time  study  experts,  "efficiency  experts,"  etc. 

The  job  analyst  himself  should  be  a  technician  who  combines 
the  qualities  of  human  insight,  scientific  temper  and  a  sense  of 
mechanical  ingenuity.  He  will  know  in  detail  all  the  topics 
which  his  study  must  cover;  and  will  utilize  every  means — inter- 
views with  staff  experts,  foremen  and  workers,  observation,  study 
of  records,  use  of  a  time  study  expert,  etc. — to  get  the  necessary 
data.  The  work  is  thus  peculiarly  exacting  in  the  type  of  person 
required.  For  he  should  combine  an  agreeable  personality  with  a 
ready  understanding,  tact,  patience  and  ability  to  put  his  findings 
clearly  into  writing.  It  is  highly  important  that  this  expert 
qualify  fully  on  the  side  of  ability  to  get  along  with  people, 
ability  to  see  their  point  of  view  and  put  himself  in  their  place. 
His  reception  will  be  cordial  in  proportion  as  he  adopts  a  learning 
attitude,  is  receptive  and  a  good  listener.  It  is  only  fair  to 
himself  that  he  indicate  to  foremen  and  workers  that  at  the  job 
in  question  they  and  not  he,  are  the  experts.  After  as  long  con- 
tinued study  as  is  necessary  to  get  accurate,  inclusive  and  con- 
vincing data  (this  may  mean  weeks  and  months  at  certain  jobs), 
he  should  put  his  analysis  into  writing.  Gaps  in  knowledge  are 
never  so  evident  as  when  data  is  fully  written  out  under  a  topical 

1  See  discussion  of  objections  to  shop  committees  in  Chapter  XXIX. 


272  PERSONNEL  ADMINISTRATION 

arrangement.  And  continually  throughout  his  work,  after 
initial  deductions  are  made,  he  will  save  himself  trouble  and  mis- 
understanding if  he  goes  over  his  findings  with  foremen  and 
workers  before  presenting  the  completed  data  to  the  committee 
on  job  analysis.1  The  ground  covered  and  the  subject  matter 
of  his  report  we  have  already  considered  in  discussing  the  con- 
tent of  a  job  analysis. 

But  it  remains  to  consider  how  this  material  is  to  be  used  in 
order  to  secure  agreement  upon  the  four  points  which  are  to  be 
taken  to  define  a  standard  of  achievement  at  each  job: 

(a)  The  amount  of  work  to  be  done  in  a  given  unit  of  time, 

(fc)  The  quality  of  work  to  be  accepted  as  satisfactory. 

(c)  The  cost  of  the  work — considering  all  factors  but  pay  rates. 

(d)  Time  elements  including  regularity  of  attendance.* 

Consideration  of  each  of  these  four  items  will  help  to  show  how 
the  adoption  of  the  job  analysis  is  prepared  for. 

Use  of  Collected  Data. — The  amount  of  output  of  an  individual 
or  of  a  group  is  presumably  known  from  past  production  records 
and  recent  time  studies.  With  this  knowledge  in  hand  it  then 
becomes  necessary,  if  the  job  analysis  is  to  be  used  as  a  basis  for 
conclusions  about  the  content  and  terms  of  work,  to  decide : 

1.  What  the  time  unit  is,  in  terms  of  which  the  output  is  to  be 
measured  and  determined.  Shall  it  be  an  hour,  a  day,  or  a 
week — or  an  even  longer  period  ?  Generally  speaking  the  hourly 
unit  is  far  too  short  as  a  basis  for  study  and  for  setting  a  rate  of 
output  as  well.  It  does  not  make  proper  allowance  for  fluctua- 
tions in  output  through  the  day;  it  keeps  a  too  constant  drive 
before  the  mind  of  each  worker  who  tends  always  to  be  asking 
himself:  "Am  I  getting  this  hour's  stint  out  on  time?"  Where 
such  worry  exists,  real  efficiency  is  reduced.  If  a  day  of  a  stipu- 
lated number  of  hours  is  used  as  the  unit,  that  will  at  some  few 
jobs  be  found  satisfactory. 

But  usually  we  should  prefer  to  see  output  measured  and  agreed 
upon  in  terms  of  the  individual's  or  gang's  week's  work.  That 
gives  a  unit  of  measurement  in  which  the  worker  "has  time  to 

1  See  Job  Analyst's  Instruction  Card  in  Outline  of  Job  Analysis,  p.  10. 

1  It  should  be  explained  that  the  illustrative  detail  of  the  following  method 
of  joint  job  study  presupposes  that  the  operation  is  a  fairly  regular  machine 
job.  But  the  underlying  principle  of  joint  study  and  agreement  on  certain 
standards  of  work  it  applicable  to  nearly  all  jobs  with  some  modification. 


SUPERVISION  AND  CONTROL  OF  JOB  ANALYSIS       273 

turn  around."  If  one  morning's  work  goes  slowly,  the  next 
morning's  may  go  better  after  the  worker  has  a  full  night's  sleep. 
If  it  is  hot  for  two  days,  the  end  of  the  week  may  be  cooler, 
etc.  The  variables  which  influence  the  amount  of  work  which 
it  is  possible  to  do,  tend  to  cancel  out  over  a  period  of  a  week 
as  they  do  not  over  a  shorter  working  period.1 

It  may  be  objected  at  this  point  that  if  a  piece  work  system  is 
adopted,  there  need  be  no  bother  about  agreeing  on  amounts  of 
work;  that  settles  itself  automatically  for  each  worker. 

This  is  partly  true.  And  piece  work  may  be  a  satisfactory 
method  if  there  has  been  study  and  joint  agreement  upon  a 
maximum  week's  output  above  which  it  will  not  be  safe  to  go  from 
a  health  point  of  view;  upon  a  minimum  output  below  which  it 
does  not  pay  either  party  to  keep  the  worker  at  the  machine; 
and  upon  joint  control  of  piece  rates.  In  other  words,  even  the 
use  of  a  piece  work  system  does  not  lessen  the  importance  of  job 
analysis  for  the  protection  of  all  parties. 

There  is  no  single  answer,  therefore,  to  the  question  of  right 
time  units  for  the  measurement  of  a  job,  and  the  setting  of  agreed 
amounts  of  output.  But  we  are  in  this  discussion  assuming 
that  the  amount  is  to  be  determined  in  terms  of  a  week's  work. 

2.  It  is  further  necessary  to  decide  how  many  degrees  or 
grades  of  competence  at  a  job  will  be  recognized,  as  offering  a 
basis  for  differences  in  pay  for  the  week's  work. 

Up  to  the  present,  organized  labor  in  trades  where  piece  work 
is  not  customary,  has  tended  to  oppose  systems  of  differential 
pay.  It  may  be  that  even  with  a  plan  like  that  here  under 
consideration,  they  will  still  prefer  for  some  time  to  come  to 
recognize  only  two  grades  of  competence — that  of  journeyman 
and  apprentice.  If  such  be  the  case,  the  decision  jointly  agreed 
to  in  the  job  analyis  committee  becomes  the  basis  for  bargaining 
about  the  pay  to  be  given  for  these  two  grades.  And  it  is 
undoubtedly  true  that  there  are  many  jobs  where  for  one  reason 
or  another,  it  would  be  quite  impractical  to  attempt  to  measure 
and  evaluate  differences  in  competence,  which  are  to  be  reflected 
in  differences  in  pay.  But  the  unions'  reason  for  insisting  that 
there  shall  be  no  differentiation  in  the  pay  of  workers  of  different 

Even  this  statement,  however,  is  subject  to  the  important  reservation 
that  careful  studies  show  at  some  jobs  as  much  as  15  per  cent,  variation  in 
the  amount  of  work  which  it  is  possible  to  do  in  summer  and  winter.     See 
HUNTING-TON,  E.     Civilization  and  Climate,  Chapters  IV  and  VI. 
18 


274  PERSONNEL  ADMINISTRATION 

degrees  of  competence  (in  cases  where  such  differences  might 
profitably  to  all  be  recognized)  disappears  as  soon  as  the  whole 
arrangement  becomes  a  matter  of  joint  agreement.  For  if  the  least 
competent  worker  whom  it  is  jointly  agreed  the  shop  can  fairly 
be  asked  to  retain,  is  to  get  (as  he  would  under  a  scheme  of  rep- 
resentative control)  an  adequate/'comfort-minimum"  wage,  there 
is  no  reason  why  all  whose  work  is  better  than  this  minimum  group 
should  not  earn  more. l  Where  a  condition  of  approximately  equal 
bargaining  power  is  developed,  as  was  true,  for  example,  during 
the  war  under  the  awards  of  the  Shipbuilding  Labor  Adjustment 
Board,  we  see  less  reluctance  on  the  part  of  the  unions 
to  recognize  and  allow  differences  in  reward  for  differences  in 
competence  at  a  job.  The  differentiation  in  these  awards 
recognized  in  some  cases  the  following  grades:  first-class  journey- 
man, second-class  journeyman,  helper,  apprentice. 

For  purposes  of  illustration  let  us  assume,  therefore,  that  both 
sides  have  agreed  to  recognize  four  different  grades  of  compe- 
tence— which  would,  of  course,  be  reflected  in  four  different 
amounts  of  weekly  output  for  workers  of  different  degrees  of 
ability  at  the  same  job. 

3.  It  is  then  necessary  to  decide  (a)  how  the  whole  group  of 
workers  shall  be  divided;  (b)  whether  the  grouping  shall  start 
from  the  best  workers  and  scale  down,  or  start  with  a  medium 
group  and  work  both  ways  to  get  the  better  and  the  poorer 
groups;  and  (c)  whether  the  differences  in  the  output  from  one 
grade  to  another  shall  be  a  constant  factor. 

Without  attempting  here  anything  like  proof,  we  offer  it  as  our 
experience  that  the  least  arbitrary  grouping  is  that  which  begins 
with  the  best  workers.  Study  of  the  production  records  of  the 
best  workers  plus  corroborative  time  study  will  afford  a  fairly 
accurate  knowledge  of  a  fair  output  for  this  group,  because  theirs 
will  be  the  most  fixed  and  unchanging  unit  of  accomplishment. 
An  attempt  to  work  from  some  "average"  or  minimum  group 
to  determine  output  is  more  arbitrary;  it  requires  far  more 
time  studies  to  get  a  basis  of  judgment;  it  involves  elements 
which  are  much  more  variable. 

In  determining,  then,  what  amounts  of  work  Grade  A  (the 
best  group  of  workers)  are  to  do  in  a  week,  the  committee  would 

1  Indeed,  the  unions  contend  with  some  force  that  there  i-  now  in  many 
cases  no  reason  why  the  employer  who  wants  to  pay  more  than  the  union 
scale  to  his  better  workers  cannot  do  so. 


SUPERVISION  AND  CONTROL  OF  JOB  ANALYSIS        275 

work  from  actual  past  records  and  time  studies.  These  time 
studies,  in  their  turn,  should  be  open  to  joint  scrutiny  to  assure 
that  (a)  all  fair  allowances  have  been  made  for  breakdowns,  use 
of  toilets,  going  for  drinking  water,  etc.,  etc.;  (b)  all  "freak" 
times  have  been  eliminated,  i.e.,  times  too  high  or  too  low;  (c) 
the  studies  have  been  taken  at  typical  machines;  and  (d)  the 
worker  has  worked  at  a  customary  rate  of  speed  and  with  the 
customary  technique.  Mr.  Taylor  himself  has  well  stated 
the  objective  to  be  held  in  view  in  carrying  on  time  study: 

"It  must  be  distinctly  understood  that,  in  referring  to  the  possibili- 
ties of  a  first-class  man,  the  writer  does  not  mean  what  he  can  do  when 
on  a  spurt,  or  when  he  is  overtaxing  himself,  bid  what  a  good  man  can 
keep  up  for  a  long  term  of  years  without  injury  to  his  health,  and  become 
happier  and  thrive  under."1 

4.  It  is  next  necessary  to  reach  an  agreement  as  to  the  elements 
to  be  included  in  a  "fair  week's  work"  for  each  grade.  Is  it 
to  be  construed  only  in  terms  of  quantity  of  output? 

The  answer  here  will  depend  upon  the  characteristics  of  the 
job;  but  generally  there  are  other  factors  than  (a)  quantity  to 
consider.  There  are  also,  as  mentioned  above: 

(6)  Quality. — What  is  to  be  considered  standard  quality? 
How  many  seconds,  rejects,  spoiled  pieces,  etc.,  are  to  be  allowed 
at  a  job  in  a  week?  There  should  be  a  definite  understanding 
on  these  matters. 

(c)  Costs. — If  there  is  a  standard  per  cent,  of  waste  allowed, 
amount  of  power  to  be  consumed,  amount  of  materials  to  be 
consumed,  etc.,  it  may  be  possible  to  embody  these  elements 
into  the  measurement  of  a  fair  week's  work. 

(d)  Attendance. — Where    the  organization  must    be  able  to 
count  upon  the  completion  of  a  certain  amount  of  work  per  day 
to  keep  a  balanced  schedule  in  the  flow  of  work  between  de- 
partments, it  will  be  important  that  an  agreed  proportion  of 
each  worker's  weekly  output  be  done  each  day.     Otherwise  the 
whole    scheduling    process    might   become   sadly  demoralized. 
The  suggestion  is  that  it  will  be  fair  to  all  to  agree  that  no  less 
than  10%  nor  over  25%  of  the  individual's  week's  work  be  done 
in  anyone  day.     This  might  mean  also  that  one  day's  absence 
would  be  allowed  without  any  loss  of  pay,  provided  the  week's 
work  is  done  on  time,  and  the  work  of  the  days  before  and  after 

Quoted  by  E.  D.  JONES.  The  Administration  of  Industrial  Enter- 
prises, p.  219. 


276  PERSONNEL  ADMINISTRATION 

the  absence  are  planned  accordingly.  More  than  one  day's 
absence  in  the  week  would  then  definitely  involve  a  failure  for 
that  week  to  qualify  in  the  present  grade.  The  worker  would 
not,  because  of  absence,  "make  his  grade."  Similarly  he  might 
not  because  of  poor  quality  or  excessive  waste  "make  his  grade," 
even  though  the  amount  of  output  might  be  up  to  the  agreed 
figure.  This  type  of  control  over  absence  seems  to  us  the  most 
conducive  to  self-respect  and  the  most  reasonable  that  is 
available. 

Grade  A  would  thus  stand  not  simply  for  X  units  of  output  per 
week;  but  for  those  units  in  terms  of  an  accepted  quality  plus  a 
degree  of  economical  operation  plus  a  stipulated  regularity  in 
attendance.  And  the  records  would  have  to  be  devised  to  show 
these  facts  in  proper  correlation. 

It  is  understood,  of  course,  that  all  the  other  relevant  data 
included  in  the  analysis  should  be  brought  to  bear  to  qualify 
the  final  conclusions  about  the  content  of  a  grade.  Questions 
of  fatigue,  special  strain,  occupational  disease,  adverse  working 
conditions,  rhythm  of  work,  length  of  the  working  life,  etc., 
etc.,  should  all  play  a  part  in  the  joint  effort  to  reach  the  final 
decision. 

Grades  B,  C,  and  D — the  other  three  less  efficient  grades — 
have  then  to  be  agreed  upon  in  the  same  terms.  One  item  upon 
which  agreement  is  necessary  in  this  connection  is  the  amount 
of  the  differential  in  the  quantity  of  work  from  grade  to  grade. 
We  shall  let  this  differential  be  represented  by  P.  Whether  or 
not  it  would  then  be  fair  to  say,  for  example,  that 

Grade  B  =  A  -  P 
Grade  C  =  A  -  2P 
Grade  D  =  A  -  3P 

will  depend  upon  the  groupings  into  which,  as  a  result  of  study 
of  the  past  production  records  and  time  studies  which  are  avail- 
able, the  workers  l>elow  grade  A  tend  to  fall.  The  reckoning 
is  simpler  if,  as  indicated  above,  P  is  a  constant;  but  since  these 
gradations  are  a  matter  for  joint  agreement,  the  variable  would 
not  need  to  be  a  constant. 

Each  week,  assuming  for  the  moment  that  the  analysis  has 
been  "adopted,"  each  worker  would  by  his  own  showing  in  the 
correlation  of  the  agreed  factors  do  one  of  three  things.  He 
would  either  (1)  make  his  grade,  (2)  fall  Inflow  his  grade,  or  (3) 
so  far  excel  his  grade  as  to  approximate  the  next  higher  grade. 


SUPERVISION  AND  CONTROL  OF  JOB  ANALYSIS       277 

Now,  whether  or  not  wage  amounts  of  the  individual  are  to  be 
changed  each  week  in  correspondence  to  his  week's  grade  is  a 
matter  for  further  joint  decision.  It  is  not  a  point  of  great  im- 
portance; but  it  seems  to  us  that  it  will  be  fairer  all  around  and 
there  will  be  more  constant  and  normal  stimulus  to  improvement, 
if  the  grade  is  not  considered  as  altered  because  of  one  week's 
deviation  from  grade.  Our  suggestion  is  that  the  grading  is 
more  flexible  if  some  such  arrangement  as  the  folio  wing  is  adopted: 

A  worker  who  is  in  Grade  A  because  of  his  record  when  the  job 
analysis  is  adopted  will  remain  there,  as  long  as  his  record  for  10 
out  of  any  12  successive  weeks  is  up  to  grade;  if  it  falls  below  that 
he  should  at  the  expiration  of  the  twelfth  week  go  automatically 
into  Grade  B.  But  he  returns  to  Grade  A  whenever  in  5  out 
of  any  6  successive  weeks,  he  makes  the  record  required  in  Grade 
A.  (The  number  of  weeks  used  throughout  is  only  illustrative, 
since  this  is  properly  a  matter  for  agreement) . 

A  worker  initially  in  Grade  B  will  remain  there  as  long  as  his 
record  for  10  out  of  any  12  successive  weeks  is  up  to  grade.  He 
will  advance  to  Grade  A  whenever  his  record  is  up  to  Grade  A 
for  any  5  out  of  6  successive  weeks.  On  the  other  hand,  he 
will  fall  back  to  Grade  C,  if  his  record  shows  only  9  weeks  out  of 
12  in  which  he  makes  his  B  grade.  But  he  returns  to  Grade 
B  as  soon  as  in  5  out  of  6  weeks  he  makes  the  Grade  B  record. 

And  similarly  with  the  two  lower  grades.  It  is  understood 
that  the  worker  who  cannot  make  Grade  D  in  5  out  of  6  weeks 
is  not  sufficiently  proficient  to  be  retained.  The  aim  is,  in  short, 
to  secure  a  method  which  will  define  work,  offer  stimulus  to  im- 
provement in  grade,  and  provide  a  simple,  understandable  and 
more  or  less  self-determining  gauge  of  relative  ability  and  effort. 

But  we  are,  we  must  definitely  urge,  less  concerned  to  secure 
agreement  to  all  the  above  details  (which  are  really  only  illustrative 
and  applicable  to  a  limited  number  of  repetitive  jobs)  than  to 
make  clear  the  wide  application  of  the  principles  involved. 

Principles  Governing  Use  of  Job  Analysis. — These  principles 
may  now  be  recapitulated  as  follows: 

The  demand  of  managers  and  ambitious  workers  for  recogni- 
tion of  differences  in  competence  at  a  job  in  terms  of  output, 
quality  and  low  unit  costs  is  a  widespread  and  probably 
fundamentally  sound  demand. 

To  give  practical  effect  to  this  demand,  job  analysis  as  here 
defined  is  necessary. 

But  job  analysis  will  be  accepted  and  its  results  used  by  the 


278  PERSONNEL  ADMINISTRATION 

workers  only  as  they  are  parties  to  its  adoption — and  to  the 
adoption  of  the  rates  of  pay  for  the  specified  jobs.1 

Workers'  participation  in  adopting  the  analysis  will  be  most 
conveniently,  effectively  and  democratically  undertaken  through 
the  agency  of  a  representative  Job  Analysis  Committee. 

The  findings  of  this  committee  should  include  some  more  or 
less  specific  definition  of  the  grades  of  competence  agreed  upon 
as  fair  at  each  job. 

The  findings,  after  acceptance  by  the  workers  at  the  job  in 
question,  should  then  be  turned  over  to  a  Committee  on  Wage 
Rates,  as  a  basis  for  more  enlightened  action  on  payment. 

Definition  of  Fair  Day's  Work. — From  the  foregoing  discus- 
sion we  draw  the  conclusion  that  a  fair  day's  work  is  that  amount 
of  work  in  terms  of  quantity,  quality,  etc.,  etc.,  which  all  parties 
agree,  under  the  existing  circumstances  and  with  the  available  facts, 
to  be  satisfactory  because  reasonable,  possible  and  expedient. 

The  foregoing  conception  of  job  analysis  and  its  use  has  a  grip 
upon  reality  and  an  inclusive  scope  from  which  it  is  hard  to  escape 
when  once  it  is  understood.  The  factory  which  wants  to  work 
with  the  real  stuff  of  human  and  democratic  industrial  method 
and  organization  will  work  at  job  analysis  as  a  joint  undertaking; 
for  here  it  is  face  to  face  with  the  most  living  issues  and  prob- 
lems which  the  life  of  the  factory  presents.  Here  we  are  tackling 
in  first-hand  encounter  the  elusive  questions  of  interest  in  work 
and  shop  productivity.  We  are  at  one  of  the  two  points  where 
the  workers  feel  that  divergences  of  interest  in  the  operation  of 
the  factory  may  occur;  hence,  we  are  at  a  place  where  the  value 
of  shop  representation  is  superlative.  Upon  work  and  upon  pay, 
differences  of  vital  consequence  may  arise  between  management 
and  men;  and  the  measure  of  the  sound  business  acumen  of  both 
parties  will  therefore?  lie  in  their  ability  to  see  that  these  two  are  the 
points  at  which  mutual  interchange  should  take  place  on  as  an 
infonned  a  basis  as  possible. 

Job  Analysis  in  the  Civil  Service. — In  conclusion,  reference 
should  be  made  to  the  problem  of  job  analysis  in  the  public 
service.  The  fundamental  principles  underlying  a  study  of 
civil  service  positions  differ  in  no  important  particular  from  those 
applicable  in  industry.  But  the  natifre  of  the  problem  is  modified 
by  the  fact  that  so  often  the  important  element,  from  the  view 

1  See  Chapter  XXIII  which  takes  up  the  discussion  of  a  payment  method 
at  this  point. 


SUPERVISION  AND  CONTROL  OF  JOB  ANALYSIS        279 

of  economy  and  efficiency  as  well  as  fair  public  administration, 
is. a  «oinpQ,rativt  study  of  different* jdfes  bearing  the  same  or  simi- 
lar titles.  The  effort  has  to  be,  first,  to  classify  titles  so  that  they 
always  connote  approximately  the  same  duties;  second,  to  com- 
pare the  job-content  at  work  in  different  branches  of  the  public 
service  bearing  the  same  title;  and  third,  to  standardize  salaries 
in  relation  to  titles  and  duties. 

This  work  of  comparison  is  by  no  means  absent  in  industry. 
Large  corporations  with  a  number  of  plants  are  not  long  in  seeing 
the  necessity  for  a  certain  amount  of  such  standardizing  of  titles, 
work  and  pay,  for  similar  jobs  in  different  plants.  But  no 
attempts  to  make  these  uniform  can  be  satisfactory  without  an 
adequate  basis  of  separate  job  analysis  in  each  plant,  as  well 
as  in  each  government  department. 

This  being  so,  the  preparation  and  acceptance  of  these  analyses, 
in  public  or  private  business,  is,  for  reasons  which  we  have  already 
elaborated,  necessarily  a,  joint  labor  of  experts,  administrators  and 
workers.  The  public  service  promises,  indeed,  to  be  one  of  the 
most  fruitful  fields  for  the  application  of  the  principles  laid  down 
in  this  chapter;  since  there  the  problem  of  securing  initiative, 
efficiency  and  interest  in  work  is  peculiarly  to  the  fore.  And 
job  analysis,  conceived  and  executed  in  the  representative  manner 
here  suggested,  deals  a  death  blow  at  the  very  vitals  of  bureau- 
cracy. For  it  recovers  to  the  individual  worker  a  voice  in  the 
determination  of  the  terms,  methods  and  conditions  of  his  work; 
it  ministers  to  his  self-respect;  and  it  minimizes  the  chance  for 
the  petty  tyranny  of  small-minded  executives. 

The  incalculable  benefit  of  arousing  an  active  sense  of  partner- 
ship in  the  enterprise  is  especially  to  be  prized  in  government 
service,  since  the  tendency  is  to  a  dangerous  degree  toward  a 
passive  acceptance  of  the  governmental  agency  as  a  dispenser 
of  sinecures.  It  is  because  job  analysis  assumes  change,  the 
need  of  change  and  the  possibility  of  infinite  improvement  that 
its  influence  in  bureaucratic  organizations  can  be  of  priceless 
value.  But  that  value  is  to  be  derived  only  upon  one  condition; 
that  the  whole  undertaking  becomes  the  subject  for  thoroughly 
representative  determination  and  application.  In  this  way  it  is 
not  only  brought  into  harmony  with  principles  upon  which  the 
government  of  a  democratic  people  presumably  rests;  it  is 
brought  into  harmony  with  principles  of  human  nature  from 
which  there  is  no  escape. 


280  PERSONNEL  ADMINISTRATION 

Selected  References 

GILBRETH,  F.  B.  and  L.  E.  Applied  M«ti«n  Study;  a  '  •  -  •  *.  Papers 
on  the  Efficient  Method  to  Industrial  Preparedness.  Sturgis  and 
Walton,  1917. 

GILBRETH,  F.  B.  and  L.  E.  Fatigue  Study;  The  Elimination  of  Humanity's 
Greatest  Unnecessary  Waste;  a  First  Step  in  Motion  Study.  Sturgis 
&  Walton,  1916. 

GILBRETH,  F.  B.  Motion  Study;  a  Method  for  Increasing  the  Efficiency 
of  the  Workman.  N.  Y.,  Van  Nostrand  Company,  1911. 

GOULD,  E.  C.  How  to  Reduce  the  Turnover  of  Labor.  (In  Iron  Age, 
v.  101,  pp.  874-875,  April  4,  1918.) 

HOXIE,  R.  F.  Scientific  Management  and  Labor.  N.  Y.,  D.  Appleton  and 
Co.,  1916. 

HUBBELL,  N.  D.  Written  Standard  Job  Specifications.  (In  Industrial 
Management,  v.  54,  pp.  431-436,  Dec.,  1917.) 

JONES,  E.  D.  Administration  of  Industrial  Enterprises;  with  Special  Refer- 
ence to  Factory  Practice.  N.  Y.,  Longmans,  Green  and  Co.,  1916, 
pp.  226-241. 

KELLY,  R.  W.  Hiring  the  Worker.  N.  Y.,  Engineering  Magazine  Co., 
1918.  Analyzing  the  Job,  pp.  45-56. 

METROPOLITAN  LIFE  INSURANCE  COMPANY.  Industrial  Service  Bureau. 
Hiring  and  Firing;  Suggestions  for  Employers.  Metropolitan  Life 
Insurance  Company.  1918.  (Bulletin  No.  1.)  pp.  19-23. 

TAYLOR,  F.  W.  Shop  Management,  rev.  ed.;  with  an  introduction  by 
H.  R.  Towne.  N.  Y.,  Harper,  1911,  pp.  123-126. 

TEAD,  ORDWAY  and  R.  B.  GREGG.  Outline  of  Job  Analysis.  N.  Y., 
Valentine  &  Gregg,  1918. 

U.  S.  ADJUTANT  GENERAL'S  DEPARTMENT.  Trade  Specifications  and  Index 
of  Professions  and  Trades  in  the  Army.  2d  ed.  Wash.  Govt.  Print. 
Off.,  1918.  (U.  S.  War  Department  Document  No.  774.) 

U.  S.  BUREAU  OF  LABOR  STATISTICS.  Descriptions  of  Occupations  by  the 
United  States  Bureau  of  Labor  Statistics,  (in  its  Monthly  Labor 
Review,  v.  8,  pp.  441-443,  Feb.,  1919.) 

U.  S.  BUREAU  OF  LABOR  STATISTICS.  Descriptions  of  Occupations  Pre- 
pared for  United  States  Employment  Service.  Wnah.  Govt.  Print. 
Off.,  1918.  Series  includes  Boots  and  Shoes,  Harness  and  Saddlery, 
Tanning;  Logging,  Camps  and  Saw  mills;  Metal  Working,  Building 
and  General  Construction,  Railroad  Transportation,  Shipbuilding; 
Mines  and  Mining;  Office  Employees;  Slaughtering  and  Meat  Packing; 
Water  Transportation. 

U.  S.  SHIPPING  BOARD,  EMERGENCY  FLEET  CORPORATION.  Aids  to  Em- 
ployment Managers  and  Interviewers  on  Shipyard  Occupations  with 
Description  of  Such  Occupations.  Philadelphia,  published  by  Cor- 
poration, 1918.  (Special  Bulletin  Series  on  Employment  Management 
in  the  Shipyard.) 

VALENTINE,  R.  G.  Cooperating  in  Industrial  Research.  (In  Survey, 
v.  36,  pp.  586-588,  Sept.  9,  1916.) 

VALENTINE,  R,  G.  and  ORDWAY  TEAD.  Work  and  Pay;  a  Suggestion  for 
Representative  Government  in  Industry.  (In  Quarterly  Journal  of 
Economics,  v.  31,  pp.  241-258,  Feb.,  1917.) 


CHAPTER  XX 
THE  MEASUREMENT  »F  LA10R  TURNOVER 

Labor  turnover  is  the  shifting  which  takes  place  in  an  organiza- 
tion's working  force.  It  is  the  "  change  in  the  force  due  to  men 
leaving  ....  Every  worker  who  leaves  the  employ  of  a 
given  establishment  for  whatever  reason  constitutes  a  part  in 
the  turnover  of  that  establishment.  The  study  of  labor  turn- 
over embraces  the  study  of  the  causes  and  effects  of  every  termi- 
nation of  employment  and  the  means  of  preventing  such 
terminations  as  are  socially  undesirable."1 

Labor  turnover  is  measured  in  terms  of  the  ratio  of  those  who 
leave  their  employment  in  a  given  period — usually  assumed  to 
be  a  year  unless  otherwise  stated — to  the  average  number  who 
have  been  on  the  active  pay  roll  during  the  same  period. 

The  per  cent,  of  labor  turnover,  in  other  words,  is  obtained  by 
dividing  the  number  of  those  leaving  by  the  number  in  the  total 
working  force. 

Having  given  these  definitions  categorically,  we  hasten  to  add 
that  there  is  by  no  means  complete  agreement  in  the  employ- 
ment managers'  world  as  to  what  turnover  is  and  how  it  should 
be  measured.  There  is  a  second  method  of  considering  it  which 
centers  around  the  idea  of  replacement;  and  considers  that  turn- 
over has  only  occurred  when  the  cycle  has  been  completed  from 
the  hiring  of  a  worker  to  the  hiring  of  his  successor  when  he  leaves. 
The  proposal  of  those  who  advocate  this  method  is:  "To  compute 
the  percentage  of  labor  turnover  for  any  period,  find  the  total 
replacements  for  the  period  considered  and  divide  by  the  aver- 
age number  on  the  payroll."2 

There  is  undoubtedly  much  to  be  said  for  this  method  of  com- 
puting labor  turnover,  since  it  indicates  the  success  with  which 
the  needed  working  force  is  being  maintained  and  the  needed 
amount  of  production  being  turned  out.  It  assumes,  however, 

1  SLIGHTER,  S.  H.     The  Turnover  of  Factory  Labor,  p.  1. 

2  DOUGLAS,  P.  H.     Methods  of  Computing  Labor  Turnover.     Bulletin, 
The  Taylor  Society,  v.  4,  No.  4,  p.  20. 

281 


282  PERSONNEL  ADMINISTRATION 

the  prior  standardization  of  a  plant's  production  in  terms  of  each 
individual's  day's  work  and  of  a  standard  total  day's  output  of  the 
plant — a  group  of  facts  which  are  infrequently  met  because  the 
necessary  degree  of  control  over  the  volume  of  production  can 
only  begin  to  be  obtained  by  scientifically  managed  plants.  For 
only  as  this  standard  performance  is  known  is  there  a  basis  of 
comparison  between  expected  and  actual  production. 

For  the  more  rough  anci  ready  purposes  for  which  factory  statis- 
tics are  in  the  immediate  future  likely  to  be  used,  it  seems  to  us, 
therefore,  that  the  use  of  separations  as  the  basis  of  turnover 
reckoning  is  the  more  valuable.  For  separations  have  the 
added  advantage  of  fastening  the  attention  on  the  individual 
worker  who  leaves;  and  he,  from  the  point  of  view  of  diagnosing  a 
factory's  labor  troubles,  is  the  one  in  whom  interest  centers. 

In  short,  labor  turnover  is  not  a  thing  by  itself,  an  isolated 
phenomenon  to  be  measured  and  discussed  only  in  relation  to  a 
standard  output.  To  be  sure,  it  has  a  very  close  relation  to  the 
question  of  output.  But  labor  turnover,  properly  conceived,  is 
rather  a  symptom  than  a  disease.  And  like  all  symptoms  it  is 
of  interest  to  the  practical  person  only  in  so  far  as  it  points  to 
the  nature  or  causes  of  the  maladjustment,  and  thus  leads  to 
constructive  or  preventive  measures. 

People  usually  quit  the  employ  of  a  company  because  of 
some  dissatisfaction.  And  the  effort  from  the  administrative 
point  of  view  must  be  to  discover  the  source  of  that  dissatisfac- 
tion. If  a  company's  figures  of  turnover  are  in  terms  of  separa- 
tions they  are,  therefore,  in  terms  of  dissatisfactions,  provided, 
of  course,  proper  allowance  has  been  made  in  the  computation 
for  other,  non-personal  causes. 

If  all  the  workers  in  a  department  or  in  a  whole  plant  go  out  at 
once,  the  event  is  spoken  of  as  a  strike;  and  the  board  of  directors 
at  once  inquires  of  the  manager  as  to  the  reason  for  it  and  the 
nature  of  the  men's  demands.  Indeed,  the  management  may  be 
severely  censured  for  letting  an  interruption  of  work  occur.  But 
boards  of  directors  and  managers  do  not  always  so  readily 
see  that  labor  turnover — or  the  largest  single  part  of  it — is  simply 
a  strike  by  erosion,  about  which  they  should  be  profoundly  exer- 
cised. It  is  a  gradual  wearing  away  of  the  working  force  one  at 
a  time,  due  to  some  cause  and  some  demand  which  is  unvoiced 
in  any  formal  way  because  no  channel  of  communication  or  ad- 
justment is  provided.  And  it  is  as  important  to  find  out  and 


THE  MEASUREMENT  OF  LABOR  TURNOVER  283 

meet  this  demand,  when  it  is  a  just  one,  as  it  is  in  the  case  of  an 
actual  strike. 

The  Formulae  of  Labor  Turnover. — Reduced  to  its  simplest 
terms,  the  formula  for  the  determination  of  labor  turnover  would 
be: 

m  ,,  ,  S  (Total  separations) 

T  (turnover)   =  ^  /rr.  ^  , r^ 

r  (Total  average  force  on  pay  roll) 

As  it  stands,  however,  this  formula  is  too  simple  to  disclose  very 
much  about  the  meaning  of  the  figures  of  separation.  Some 
modifications  in  the  method  of  computation  are  essential.  Hence 
we  urge  that  the  figures  of  leaving  be  itemized  in  ways  that  give 
them  significance.  An  initial  division  may  usefully  be  made 
between  avoidable  causes,  unavoidable  causes  and  lay-offs  due 
to  permanent  curtailment  in  working  force  (as,  for  example,  the 
laying-off  of  a  staff  of  millwrights  who  have  been  employed  for  a 
number  of  months  to  set  up  new  machinery). 

Any  wide  agreement  as  to  which  causes  for  leaving  are  avoid- 
able or  unavoidable  will  undoubtedly  be  difficult  to  secure.  But 
wide  agreement  is  not  so  much  needed  at  first  as  agreement  of  all 
concerned  in  one  plant  to  keep  its  own  figures  consistently  on  the 
same  basis  over  a  period  of  years  so  that  they  are  valid  for  com- 
parative purposes.  For  after  all,  their  major  purpose  is  to 
reflect  from  time  to  time  the  success  of  the  management  in  re- 
ducing avoidable  causes  of  dissatisfaction. 

Tentatively,  therefore,  we  suggest  that  typical  unavoidable 
causes  of  leaving  may  be:  Death,  marriage,  "moved  away," 
sickness,  better  position.  We  appreciate,  however,  that  in  any 
given  case  any  one  of  these  causes  may  have  been  avoidable. 

Causes  of  leaving  which  are  usually  avoidable  are:  Accidents, 
disagreeable  work,  low  wages,  laziness,  poor  adaptation  and 
occupational  sickness. 

Discharge,  depending  on  the  particular  circumstances,  may  be 
either  avoidable  or  unavoidable — although  it  is  frequently  avoid- 
able. It  should,  however,  in  addition  to  appearing  as  avoidable 
or  unavoidable  be  separately  listed  in  any  case. 

Lay-offs  due  to  seasonal  fluctuations  are  to  be  considered 
from  the  point  of  view  of  measuring  dissatisfaction,  as  avoidable 
causes.  Lay-offs  for  permanent  curtailment  are  unavoidable. 

With  these  explanations  we  suggest  the  following  modification 
of  the  previous  formula,  as  giving  a  figure  which  really  reflects 


284  PERSONNEL  ADMINISTRATION 

in  some  approximate  way  the  relative  success  of  the  manage- 
ment in  keeping  the  sources  of  complaint  and  dissatisfaction  at 
a  minimum. 

(8  -  U)  -  LC 
F 

In  this  equation,  T  equals  per  cent,  of  turnover;  S  equals 
total  separations;  U  equals  unavoidable  separations;  LC  equals 
lay-offs  due  to  permanent  curtailments  in  working  force  (but 
not  seasonal  lay-offs) ;  and  F  equals  the  average  force  on  tho 
payroll.  The  figure  F  may  be  arrived  at  in  several  ways;  but 
perhaps  as  simple  a  method  as  any  is  to  use  the  total  weekly 
payroll  figure  of  the  departments  in  question.  And  if  the  aver- 
age force  for  a  year  is  sought,  these  fifty-two  amounts  could  be 
added  and  divided  by  fifty-two  to  give  a  yearly  average. 

If  the  figures  represented  by  S,  U,  LC,  and  F  are  obtained  in 
terms  of  a  week,  in  order  to  get  the  standard  labor  turnover 
figure,  T  should  be  multiplied  by  52;  although  the  resulting  figure 
will  only  mean  that  the  turnover  for  that  week  was  at  the  rate  of 
such  and  such  a  per  cent,  per  year. 

When,  however,  fifty-two  consecutive  actual  weekly  per  cents, 
are  available,  the  total  of  those  fifty-two  will  give  the  actual 
yearly  avoidable  turnover. 

Endless  refinements  in  the  turnover  figures  can,  of  course, 
be  made.  Indeed,  the  literature  on  this  subject  is  already 
voluminous  and  concerned  with  a  great  variety  of  refinements  in 
methods  of  calculation.  For  example,  complications  due  to  the 
permanent  reduction  or  the  permanent  increase  of  the  working 
force  during  the  period  in  which  the  amount  of  turnover  is 
sought  have  occasionally  to  be  met.  But  in  the  interest  of 
emphasizing  the  main  idea  of  analyzing  the  remediable  causes  of 
dissatisfaction,  we  shall  suggest  no  further  modifications  in 
formulae. 

Figures  showing  the  total  factory  turnover  do  not,  however, 
necessarily  indicate  a  great  deal.  The  more  itemized  and  local- 
ized they  can  be,  the  more  significant  they  tend  to  become.  For 
example,  turnover  when  kept  by  departments  often  shows  one  or 
two  departments  to  be  the  principal  causes  of  high  turnover; 
and  when  kept  by  rooms  or  machines  it  may  even  indicate  that  it 
is  one  particular  operation  or  one  foreman  who  is  causing  much 
of  the  trouble.  Similarly  the  segregation  of  turnover  by  sex,  by 


THE  MEASUREMENT  OF  LABOR  TURNOVER  285 

age,  by  wage  groups,  may  reveal  discrepancies  in  company 
procedure  that  will  otherwise  remain  unsuspected. 

Labor  turnover  figures  should  be  compiled,  in  short,  not  to 
cover  blank  forms  with  figures,  but  in  order  to  show  where 
disaffection  exists  in  the  plant,  why  it  exists  and  how  much  of  it 
can  be  eliminated. 

There  is  considerable  value,  also,  in  one  other  set  of  figures 
which  shows  the  length  of  employment  of  leavers.  If,  as  is  often 
the  case,  the  most  turnover  comes  within  the  first  six  months  of 
employment,  it  is  likely  to  argue  some  deficiency  in  methods  of 
selection  or  training.  If  it  comes  with  workers  of  long  standing, 
that  may  indicate  little  opportunity  for  advancement  in  wages  or 
in  kind  of  work.  When  carefully  scrutinized,  facts  about  length 
of  employment  of  leavers  are  likely  to  be  illuminating. 

Discovering  Causes  of  Turnover. — All  this  discussion  assumes 
that  the  company  has  accurately  discovered  the  cause  of  each 
individual's  leaving.  In  the  absence  of  a  centralized  employ- 
ment office  through  which  all  leavers  are  required  to  report,  the 
chances  that  the  true  cause  will  be  revealed  are  exceedingly  small. 
Workers  usually  will  not  or  do  not  tell  foremen  or  timekeepers 
the  real  reasons  for  their  departure  It  may,  indeed,  be  hard 
enough  for  the  interviewer  to  get  a  candid  answer  to  his  queries. 
But  the  chances  of  accurate  analysis  are  greatly  enhanced  if 
some  tactful  person  in  the  employment  manager's  office  is  re- 
quired to  spend  several  minutes  in  considering  with  the  leaver 
in  private  interview  the  reasons  for  his  going. 

The  danger  here  is  that  the  interviewer  will  put  into  the  leaver's 
mouth  some  reasons  which  the  worker  will  immediately  take  up 
and  repeat  back  without  ever  disclosing  what  is  really  on  his 
mind.  The  only  way  to  prevent  this  is  for  the  employment 
manager  to  be  impressed  with  the  fact  that  the  leavers  are  par 
excellence  the  ones  who  feel  most  strongly  about  the  shortcomings 
of  some  aspect  of  the  plant's  labor  policy;  and  that  it  is  of  first 
importance  that  their  uncolored  testimony  be  secured. 

The  Cost  of  Labor  Turnover. — Although  labor  turnover  is 
not  a  fact  to  be  dealt  with  independently,  its  costs  can  to  an 
approximate  degree  be  figured  separately.  And  a  compilation  of 
the  turnover  costs  for  a  given  job,  department  or  plant  may  be 
exceedingly  useful,  as  providing  a  cogent  argument  for  changes 
and  improvements.  Admittedly  such  costs  cannot  be  arrived 
at  with  perfect  accuracy.  But  enough  of  the  items  can  be 


286  PERSONNEL  ADMINISTRATION 

segregated  or  closely  estimated  to  present  a  conservative  state- 
ment of  the  losses  in  production  and  in  indirect  expenses  due  to 
high  turnover. 

Mr.  Richard  B.  Gregg  has  presented  a  list  of  items  of  cost 
which  is  illustrative  if  not  exhaustive.  It  may,  therefore,  be  of 
suggestive  value  at  this  point  as  showing  the  charges  involved 
in  labor  turnover,  which  are  not  ordinarily  taken  into  account. 

"  These  costs  may  be  roughly  divided  into  overhead  costs  and  operating 
costs. 
"Among  the  overhead  costs  there  are: 

1.  More  rapid  depreciation  of  machinery  because  of  ignorance  or  lack  of 

skill  of  new  workers. 

2.  Extra  floor  space  and  extra  machines  to  provide  against  idleness  of  a 

certain  amount  of  machinery  due  to  shifting  labor. 
"Operating  costs  may  include  any  or  all  of  the  following: 

1.  Time  of  increased  superintendence  or  office  work,  including: 

(a)  Time  spent  by  foremen  or  superintendent   in  discharging   a 

worker  where  that  is  the  way  the  vacancy  occurred. 

(b)  Time  spent  by  foreman  or  other  workers  in  training  the  new 

employee. 

(c)  Time  spent  by  clerks  on  additional  payroll  or  other  records. 

2.  Machine  costs,  covering: 

(a)  Time  machinery  is  idle  when  a  new  worker  cannot  be  obtained 

immediately. 

(b)  Idle  machinery  for  temporary  stoppages  due  to  ignorance  or 

lack  of  skill  of  new  worker. 

(c)  Repairs  to  machines  or  renewals  of  tools  broken  for  the  same 

reason. 

3.  Material  costs,  including: 

(a)  Waste  or  damaged  material  due  to  ignorance  or  lack  of  skill  of 

new  worker. 

(b)  Difficulties  in  subsequent  processes  due  to  poor  work  by  new 

employees  in  previous  processes. 

(c)  Lower  production  while  new  employee  is  working  up  to  his  best 

skill. 

4.  Additional  accident  cost  due  to  higher  rate  of  accidents  among  new 

employees."1 

Cautions. — Figures  of  labor  turnover  and  of  its  costs  are  not, 
however,  to  be  taken  wholly  at  their  face  value.  Conclusions 
from  them  should  always  be  drawn  with  some  caution,  until 
methods  of  compiling  them  and  the  reasons  for  compiling  them 
are  known.  As  a  general  index,  as  a  barometer  of  the  trend  and 
current  of  the  factory's  labor  atmosphere,  labor  turnover  figures, 

1  GREGG,  RICHARD  B.  Labor  Turnover  Records  on  the  Labor  Problem. 
Proceedings,  American  Society  of  Mechanical  Engineers,  Dec.  4,  1917. 


THE  MEASUREMENT  OF  LABOR  TURNOVER  287 

if  carefully  prepared,  are  exceedingly  useful.  But  it  must  be 
remembered  that  to  put  qualitative  facts — facts  about  people's 
attitudes  and  desires — into  quantitative  measures  is  a  process 
in  which  results  have  to  be  viewed  with  caution. 

A  situation  which  is  sometimes  met  and  which  the  figures  if 
superficially  viewed  do  not  reveal,  is  a  rapid  turnover  among 
fifteen  or  twenty-five  per  cent,  of  the  force  while  the  other 
workers  remain  employed  fairly  constantly.  Where  this  is 
found  to  be  the  case,  the  causes  of  leaving  are  likely  to  be  differ- 
ent— and  perhaps  less  serious — than  where  the  turnover  is 
more  generally  distributed. 

Moreover,  account  must  be  taken  of  the  fact  that  seme  turn- 
over may  be  a  natural  measure  of  self-defence  against  the  monot- 
ony of  certain  kinds  of  factory  work.  A  degree  of  shifting 
from  one  plant  to  another  may  under  present  conditions  be  a 
healthy  and  socially  desirable  protest  against  present  methods 
of  utilizing  machines.  At  any  given  moment  in  one  plant,  it 
may  be  impossible  to  do  much  to  compensate  for  the  sameness 
and  dullness  of  the  work.  And  in  such  a  plant  to  attribute 
inefficiency  to  the  employment  office  because  of  a  high  labor 
turnover  is  unfair;  it  is  a  use  of  figures  without  a  sufficiently 
careful  examination  of  their  meaning. 

There  is,  indeed,  a  real  danger  that  managers  who  have  in- 
stalled separate  employment  departments  will  take  it  as  axiomatic 
that  the  amount  of  turnover  is  a  direct  index  of  the  personnel 
department's  efficiency.  It  may  be — and  it  may  not;  but  until 
the  figures  are  carefully  analyzed  and  compared  with  those  of 
previous  years  and  Of  other  plants  similarly  situated  it  is  un- 
scientific to  draw  this  conclusion. 

Remedies  for  Labor  Turnover. — If  turnover  is  a  symptom  of 
some  underlying  maladjustment,  the  cure  for  the  maladjustment 
will  remove  the  symptom.  And  since  we  are  considering 
throughout  this  book  the  ways  of  securing  a  scientific  and  human 
working  adjustment  between  management  and  men,  we  are  at 
every  point  discussing  remedies  for  the  avoidable  labor  turnover. 
There  will,  therefore,  be  no  point  in  enumerating  those  remedies 
here.  One  outstanding  remedy  of  recent  years  does,  however, 
deserve  separate  mention. 

It  is  true,  except  where  abnormal  war  conditions  have  com- 
pletely disrupted  local  labor  conditions,  that  the  introduction 
of  functionalized  employment  offices  in  charge  of  trained  execu- 


288  PERSONNEL  ADMINISTRATION 

tives  of  a  superior  type  has  of  itself  tended  to  effect  an  immediate 
and  marked  reduction  in  the  amount  of  labor  turnover.  The  fact 
that  one  office  was  specializing  in  selection  and  in  the  subsequent 
adjustments  has  almost  without  exception  brought  labor  turn- 
over within  a  twelve  months'  period  from  an  abnormal  and 
excessive  figure  to  one  more  reasonable  and  normal.  The 
evidence  obtained  from  the  figures  of  plant  after  plant  is  practi- 
cally conclusive  on  this  point. 

Labor  Loss. — Mention  should,  finally,  be  made  of  a  somewhat 
more  elaborate  method  of  computing  all  the  labor  losses  in  terms 
of  productive  hours  which  the  plant  suffers  each  day  or  week. 
"Labor  loss,"  says  Mr.  D.  L.  Hoopingarner  in  a  suggestive 
pamphlet,1  "is  the  loss  of  productivity  and  the  costs  due  to 
loss  in  applying  man  power."  Like  all  writers  who  use  the 
replacement  theory  he  assumes  a  "standard  work  force,"  and 
a  standard  flow  of  production.  And  he  bases  his  figures  of 
labor  loss  on  deviations  from  this  standard  caused  by  failure  to 
replace  needed  workers  who  have  left,  by  the  lessened  output  of 
new  workers,  by  absence  and  tardiness. 

The  formulae  and  charts  suggested  by  him  are  of  distinct  value, 
and  can  help  in  an  effective  way  to  show  the  relation  of  regularity 
in  attendance  and  of  the  efforts  of  the  working  force,  to  out  put, — 
a  correlation  which  in  some  way  or  other  it  is  essential  to  make. 
The  only  criticism,  it  seems  to  us,  which  can  be  offered,  is  not  of 
his  methods,  but  of  the  great  majority  of  plants  which  could 
not  use  his  methods  lx»cause  they  have  not  yet  determined  what 
for  them  is  a  standard  work  force  or  a  standard  day's  work  per 
unit  of  man  power.  The  method  requires,  in  other  words,  not 
merely  good  cost  accounting  methods  but  good  planning,  routing 
and  scheduling  prodecure. 

That  some  accurate  record  is  needed  of  the  loss  which  produc- 
tion suffers  because  of  the  absence  of  needed  or  expected  workers 
is  obvious.  And  to  the  extent  that  any  corporation  him  the  data 
so  that  it  can  make  use  of  Mr.  Hoopingarner's  charts,  it  will 
have  a  graphic  and  accurate  way  of  measuring  the  loss  caused  by 
this  irregular  application  of  labor. 

Conclusion. — Discussion  of  labor  turnover  loomed  large  in  the 
earlier  literature  of  employment  management.  It  seems  by 
common  consent  to  occupy  a  less  important  place  today.  Not 

1  Handbook  on  Employment  Management  in  the  .Shipyards,  Spwial 
Bulletin  on  Labor 


THE  MEASUREMENT  OF  LABOR  TURNOVER  289 

because  the  fact  of  turnover  is  any  the  less  real  or  less  important 
as  a  source  of  inefficiency  and  reduced  morale  than  it  was  five 
years  ago.  But  managers  are  coming  to  see  turnover  for  what 
it  really  is, — a  rough  gauge  upon  the  success  of  the  factory's 
labor  policy.  As  such  an  approximate  measure  it  is  useful ;  and 
the  more  refined  and  accurate  its  measurement  can  be,  the  better. 
But  the  real  interest  of  forward  looking  managers  today  is  in  those 
elements  of  positive  personnel  procedure  and  in  those  methods  of 
enlisting  interest  and  cooperation  in  effective  workmanship, 
which  assure  that  gradually  but  inevitably  the  avoidable  and 
socially  undesirable  turnover  will  decrease. 

Selected  References 

ALEXANDER,  M.  W.     Cost  of  Labor  Turnover.     (In  U.  S.  Bureau  of  Labor 

Statistics.     Bui.  No.  227,  pp.  13-27,  1917.) 
ALEXANDER,  M.  W.     Hiring  and  Firing;  Its  Economic  Waste  and  How  to 

Avoid  It.     (In  Annals,  Am.  Acad.,  v.  65,  pp.  128-144,  May,  1916.) 
ALLEN,  L.  H.     Workman's  Home:  Its  Influence  upon  Production  in  the 

Factory  and   Labor    Turnover.     (In    Am.    Society    Mechanical  Engi- 
neers Journal,  v.  40,  pp.  453-458,  June,  1918.) 
AMERICAN  ACADEMY  OF  POLITICAL  AND  SOCIAL  SCIENCE,  PHILADELPHIA. 

Stabilizing   Industrial   Employment;   Reducing  the  Labor  Turnover. 

(In  Annals,  Am.  Acad.,  v.  71,  1917.) 

COLVIN,  F.  H.     Labor  Turnover,  Loyalty  and  Output.     N.  Y.,  McGraw- 
Hill  Book  Co.,  1919. 
Cost  of  Labor  Turnover;  Symposium.     (In  Industrial  Management,  v.  57, 

pp.  239-245,  March,  1919.) 
CRUM,  F.  S.     On  the  Computation  of  the  Percentage  of  Labor  Turnover. 

I.  How  to  Figure  Labor  Turnover.     (In  Taylor  Society  Bulletin,  v.  4, 

pp.  13-17,  August,  1919.) 
DOUGLAS,  P.  H.     Methods  of  Computing  Labor  Turnover.     (In  Taylor 

Society  Bulletin,  v.  4,  pp.  19-20,  August,  1919.) 
DOUGLAS,  P.  H.     Problem  of  Labor  Turnover.     (In  American  Economic 

Review,  v.  8,  p.  306,  June,  1918.) 
EBERLE,  C.  L.     Labor  Turnover.     (In  American  Economic  Review,  v.  9, 

pp.  79-82,  March,  1919.) 
ERSKINE,  LILLIAN.     New  Men  for  Old.     (In  Everybody's  Magazine,  v.  36, 

pp.  414-427,  April,  1917.) 
FISHER,   BOYD.     Determining  Cost  of  Turnover  of  Labor.     (In  Annals, 

Am.  Acad.,  v.  71,  pp.  44-50,  May,  1917.) 
FISHER,    BOYD.     How    to     Reduce    Labor    Turnover.     (In    Annals,    Am. 

Acad.,  v.  71,  pp.  10-33,  May,  1917.) 
FISHER,  BOYD.     Methods  of  Reducing  the  Labor  Turnover.     (In  Annalst 

Am.  Acad.,  v.  65,  pp.  144-155,  May,  1916.) 
GREGG,   R.   B.     Handling  the  Problem  of  Labor  Turnover.     (In    Textile 

World  Journal,  v.  52,  pp.  2441  +,  April  28,  1917.) 
19 


290  PERSONNEL  ADMINISTRATION 

(jREG«,  It.  B.  Labor  Turnover  Records  and  the  Labor  Problem.  (In 
Am.  Soc.  Mechanical  Engineers  Journal,  v.  39,  pp.  913-914,  November, 
1917.) 

HOOPINGARNER,  D.  L.  Labor  Loss.  Philadelphia,  U.  S.  Shipping  Board, 
Emergency  Fleet  Corporation,  1918. 

KELI^EY,  R.  W.  Hiring  the  Worker.  N.  Y.,  Engineering  Magazine 
Co.,  1918.  pp.  25-44. 

SLJCHTEH,  S.  H.  Turnover  of  Factory  Labor.  N.  Y.,  D.  Appleton  & 
Co.,  1919. 

WILLIAMS,  J.  M.  Account  of  What  We  have  Done  to  Reduce  Labor  Turn- 
over. (In  Annals,  Am.  Acad.,  v.  71,  pp.  51-71,  May,  1917.) 

WILLIAMS,  J.  C.  Reduction  of  Labor  Turnover  in  the  Plimpton  Press.  (In 
Annals,  Am.  Acad.,  v.  71,  pp.  71-81,  May,  1917.) 


nr 


^          CHAPTER  XXI 
METHODS  OF  FACTORY  LABOR  ANALYSIS 

The  labor  audit  offers  a  method  for  the  diagnosis  of  an  organi- 
zation's labor  relations.  It  can  state  and  define  the  problems 
which  do  or  may  directly  effect  the  labor  relations  of  an  organiza- 
tion. It  can  provide  a  method  of  investigation  which  will  lay 
bare  symptoms  of  unsound  conditions.  It  is  perhaps  the  nearest 
possible  approach  to  an  instrument  of  precision,  a  probe  for 
industrial  ills  in  a  factory,  store,  railroad,  mine  or  other  industrial 
unit.  And  it  provides  a  method  for  an  orderly  record  of  facts 
or  of  the  progress  of  events.  It  requires,  therefore,  a  tactful 
method  of  personal  approach,  a  ready  knowledge  of  the  usual 
symptoms  and  ills,  and  an  open  but  firm  determination  to  see 
that  the  right  advice  is  not  merely  given  but  acted  upon.  What, 
then,  is  a  labor  audit? 

Definition. — The  labor  audit  is  a  reasonably  exhaustive  and 
systematic  statement  and  analysis  of  the  facts  and  forces  in  an 
industrial  organization  which  affect  the  relations  between  employees 
and  management,  and  between  employees  and  their  work;  followed 
by  recommendations  as  to  ways  of  making  the  organization  more 
socially  and  humanly  productive  and  solvent. 

The  phrase  "labor  audit"  itself  suggests  the  ends  in  view. 
We  are  familiar  today  with  the  sales  audit  and  the  financial 
audit.  Their  purpose  is  to  render  a  report  indicating  the  degree 
to  which  the  organization's  policy  and  practice  in  those  fields 
are  sound  and  solvent. 

Again,  managers  are  familiar  today  with  various  types  of 
accurate  current  reports  regarding  different  phases  of  factory  ac- 
tivity. There  are  elaborate  balance-of-stores  records;  elaborate 
production  records,  and  analyses  of  selling  conditions.  But  as 
yet  most  managements  have  not  developed  well  organized 
methods  for  recording  or  understanding  the  elements  which  go 
to  make  up  what  is  in  many  businesses  one  of  the  largest  classes 
of  expense — namely,  the  labor  costs. 

Purpose  of  a  Labor  Audit. — The  purpose  which  a  labor  audit 
serves  in  an  organization  which  has  no  modern  employment 

291 


292  PERSONNEL  ADMINISTRATION 

administration  will  differ  from  its  purpose  where  many  modern 
practices  obtain.  Where  personnel  work  is  as  yet  largely  un- 
developed the  purpose  may  be  to  secure  the  facts  to  determine 
whether  there  is  need  of  a  more  progressive  policy.  Where  a 
progressive  policy  is  already  in  operation  the  audit  will  serve  to 
check  up  its  effectiveness  and  to  indicate  needed  changes  and 
improvements. 

Bearing  in  mind  the  difference  in  the  problem  in  these  two 
cases,  it  may  be  said  in  general  that  an  audit  can  be  made  with 
useful,  practical  results  in  cases  where  low  productivity  is  due  to 
human  rather  than  to  mechanical  causes.  The  audit  may  be 
used  to  inquire  into  the  causes  of  strikes,  or  into  reasons  for  the 
absence  of  morale  in  working  groups,  where  discontent  has  not 
resulted  in  an  interruption  of  work.  It  may  be  used  to  inquire 
into  the  causes  of  that  elusive  uneasiness  usually  spoken  of  as 
labor  unrest.  It  may  be  used  to  ascertain  the  causes  of  labor 
turnover,  or  of  some  friction  or  specific  maladjustments  within 
the  organization. 

The  objection  has  been  urged  that  in  any  given  situation  the 
causes  of  difficulty  may  usually  be  found  in  one  definite  set  of 
facts  or  records  without  going  exhaustively  into  related  prob- 
lems. In  any  given  case  this  may  be  true.  But  the  purpose  of 
the  labor  audit  is  to  set  forth  items  and  causes  in  an  inclusive 
way  and  in  their  proper  perspective.  Over-worked  executives 
are  peculiarly  disposed  to  attribute  labor  difficulties  to  causes 
which  are  too  simple.  Hence,  the  labor  audit  attempts  to  show 
both  the  subtleties  and  the  complexities  of  the  causes  underlying 
a  plant's  labor  difficulties.  It  attempts  to  see  the  problem 
steady  and  see  it  whole. 

It  is  valuable  to  have  a  method  of  checking  up  all  the  possibly 
relevant  items,  even  though  some  of  them  may  not  be  in  active 
force  in  any  given  situation.  The  highest  medical  talent  now 
insists  upon  a  comprehensive  examination  of  the  patient  to  be 
certain  that  all  the  factors  contributing  to  disease  have  been 
considered.  The  comprehensive  labor  audit  performs  an  analo- 
gous service  in  the  managerial  field. 

It  has,  also,  become  a  psychological  truism  that  we  see  only 
what  we  have  been  taught  to  see,  or  what  we  have  been  told  to 
look  for.  For  this  reason,  if  for  no  other,  an  itemized  check- 
list stimulates  observational  power.  A  schematic  arrangement 
of  topics  of  any  sort  makes  it  easier  for  the  investigator  to 


METHODS  OF  FACTORY  LABOR  ANALYSIS  293 

remember  what  he  is  to  look  for  and  what  he  has  seen.  In  other 
words,  a  memorized  outline  provides  a  convenient  peg  on  which 
to  hang  facts,  impressions,  and  ideas  which  are  for  subsequent 
record. 

Moreover,  the  use  of  the  same  topical  arrangement,  which  be- 
comes reasonably  standardized  in  one's  mind  and  records,  serves 
to  make  comparison  of  records  and  facts  easier  and  more  rapid. 
Several  plants  which  made  labor  audits  several  years  ago,  go 
over  the  same  ground  at  six  months'  intervals  in  order  to  get  an 
idea  of  the  progress  that  is  being  made. 

The  value  of  a  standard  procedure  for  comparative  purposes 
is  particularly  great  for  a  holding  corporation  or  the  central 
service  organization  of  a  large  corporation  with  scattered  plants. 
The  problem  of  obtaining  and  comparing  necessary  information 
on  labor  matters  in  its  various  plants  has  become  a  grave  one  for 
the  large  corporation.  The  labor  audit  can  help  materially 
to  overcome  this  difficulty. 

Since  the  purpose  of  the  audit  is  to  discover  all  the  existing 
facts  independently  of  anyone's  opinion  as  to  whether  they  exist  or 
not,  the  more  objective  these  facts  can  be  the  less  is  the  chance 
that  personal  prejudice  and  bias  will  figure  in  the  report  of  con- 
ditions. The  aim  is  to  have  evidence  which  is  beyond  dispute; 
and  the  more  the  evidence  is  of  a  character  that  any  impartial 
person  must  accept,  the  stronger  will  be  the  case  for  adoption  of 
the  recommendations  based  upon  it. 

Yet  there  are  two  reasons  why  this  point  should  not  be 
pressed  too  far.  In  the  first  place  one  of  the  most  important 
elements  in  every  labor  situation  is  what  the  people  think — the 
people  on  both  sides.  We  made  an  investigation  in  a  concern 
where  the  workers  believed  that  the  percentage  of  cost  of  over- 
head and  "paper  work"  in  the  planning  and  scheduling  depart- 
ment was  excessive.  It  happened  in  this  case  that  the  proportion 
of  this  expense  was  not  comparatively  excessive  in  the  eyes  of 
anyone  familiar  with  the  process  of  re-organizing  methods  of 
production  control.  It  was  the  fact  that  the  workers  thought 
it  was  too  expensive  which  had  caused  some  difficulty. 

In  the  second  place,  because  of  the  nature  of  the  facts  covered 
by  a  labor  audit,  it  will  probably  never  be  possible  to  submit  all 
its  items  to  accurate  measurement  and  to  statistical  record.  An 
intelligent  use  and  interpretation  of  the  statistical  records  can 
throw  important  light  upon  the  personnel  problem.  But  it  would 


294  PERSONNEL  ADMINISTRATION 

involve  an  unwarranted  over-simplification  to  believe  that  all 
the  subtle  influences  at  work  in  the  labor  situation  can  ever  be 
recorded  in  graphs  or  figures.  That,  after  all,  is  not  what  is 
needed  or  wanted.  The  demand  is  rather  for  a  reasonably  ex- 
haustive audit  check-list  which  keeps  the  investigator's  eyes  on 
specific  problems,  most  of  which  are  objective,  or  at  least  defi- 
nite, in  content.  The  practical  result  will  then  be  that  the  in- 
vestigator's opinions  and  conclusions  are  kept  in  close  relation 
to  a  defined  group  of  facts. 

A  fundamental  purpose  of  the  labor  audit  is  to  provide  the 
management  with  a  form  of  provocative  report  on  industrial 
relations.  In  many  cases,  even  where  there  is  resident  manage- 
ment, an  accumulation  of  all  the  facts  about  a  plant's  labor 
conditions  will  supply  a  wealth  of  unanswerable  arguments  in  be- 
half of  needed  changes.  Many  managements  and  corporation 
heads,  who  do  not  often  see  the  inside  of  the  factory  need  a 
severe  jolt;  and  the  information  which  the  audit  affords  can,  if  it 
is  well  set  forth,  administer  this  jolt  without  the  rupture  which 
leads  to  personal  antagonisms  and  yet  in  a  way  that  impels  to 
remedial  action. 

Especially  in  corporations  where  a  degree  of  complacency 
exists,  either  because  profits  have  been  large,  competition  re- 
stricted, or  amicable  joint  relations  uninterrupted,  there  is  a 
tendency  to  let  well-enough  alone.  It  is  insuch  plants  as  these 
that,  from  the  point  of  view  of  modern  scientific  industrial 
and  personnel  organization  and  activity,  there  is  usually  most 
need  for  a  thorough  overhauling.  Both  production  methods  and 
ways  of  handling  the  labor  problem  are  likely  to  be  archaic  and 
inefficient. 

In  this  connection  it  is  useful  to  distinguish  l>etween  facts 
which  show  that  an  accepted  policy  is  not  being  carried  out,  and 
facts  which  point  to  the  need  of  a  change  in  policy.  In  the  former 
case  the  audit  often  works  almost  automatically  to  bring  neces- 
sary corrections.  It  is  not  an  uncommon  experience  for  the 
investigator  to  go  through  a  plant  with  a  superintendent  and,  for 
example,  ask  such  a  question  as,  "How  often  are  the  windows 
washed?"  or  "Who  is  in  charge  of  shop  housekeeping?"  and  re- 
turn to  the  plant  in  a  few  days  and  find  that  the  windows  have 
l)een  washed  or  the  shop  cleaned  up.  So  many  plants  are  defect- 
ive in  their  follow-up  and  inspection  work  regarding  personnel 
activities  that  an  audit  is  often  justified  simply  by  reason  of  the 


METHODS  OF  FACTORY  LABOR  ANALYSIS  295 

deficiencies  in  the  execution  of  policy  which  it  reveals.  There 
are  cases,  however,  where  the  facts  indicate  the  need  of  a  differ- 
ent policy,  and  where  it  is  necessary  to  do  more  than  make  a 
bare  statement  of  fact.  The  experience  of  other  plants  should 
then  be  pointed  to,  and  the  effort  made,  both  in  the  written  audit 
and  in  conferences,  to  direct  the  argument  in  such  a  way  that 
there  is  no  escape  from  the  conclusion  that  a  change  in  policy  is 
necessary. 

We  have  made  several  audits  in  plants  that  were  without  per- 
sonnel departments.  In  almost  every  case  it  was  possible  to 
convince  those  at  the  top  that  enough  problems  vital  to  sound 
management  were  being  ignored,  to  make  it  a  wise  precau- 
tion for  them  to  secure  a  special  executive  on  labor  relations. 
Indeed,  when  an  audit  puts  on  record  at  length,  under  numerous 
topics,  the  vital  points  at  which  the  company's  efficiency  is  ob- 
viously impaired  if  the  management  has  no  consecutive  policies 
on  personnel  problems,  it  can  become  a  powerful  brief  for  the 
institution  of  an  effective  personnel  department. 
.  Prerequisites  to  Making  a  Labor  Audit. — There  are  at  least 
four  essential  prerequisites  to  the  making  of  a  labor  audit. 
There  must  be : 

(a)  A  readiness  on  the  part  of  the  management,  and  pref- 
erably of  the  workers  also,  to  put  all  relevant  facts  and  records 
at  the  disposal  of  the  investigator. 

(6)  A  properly  qualified  auditor  or  investigator. 

(c)  A  method  of  conducting  the  audit  and  of  reaching  all  the 
sources  of  information. 

(d)  A  standard,  exhaustive  and  logically  ordered  check-list 
of  items.     (See  the  next  chapter.) 

It  is  important  to  understand  how  indispensable  these  pre- 
requisites are.  Regarding  the  first  there  are  usually  two  different 
possible  situations.  Either  the  management  calls  in  an  outside 
consultant  to  make  the  study,  because  it  believes  certain  bene- 
fits can  be  derived;  or  someone  in  the  management  decides 
that  a  labor  audit  can  be  profitably  made  by  the  personnel 
manager. 

In  the  first  case,  since  the  company  is  calling  in  the  consultant, 
the  presumption  is  that  it  will  put  at  his  disposal  such  informa- 
tion as  will  make  it  possible  for  him  to  draw  his  conclusions 
effectively  and  quickly.  As  a  part  of  the  education  of  the 
management,  the  consultant  may  indicate  that  he  desires  no 


296  PERSONNEL  ADMINISTRATION 

information  which  he  cannot  convince  the  company  is  relevant 
to  its  labor  problem.  But  usually  firms  which  are  willing  to 
have  an  audit  made  are  found  to  be  eager  to  proffer  all  the 
necessary  information. 

The  situation  is  somewhat  modified  where  the  consultant  is 
sent  by  the  central  management  to  one  of  its  subsidiary  plants. 
Unless  the  labor  auditor's  presence  is  explained  with  consider- 
able care  and  tact,  both  by  the  head  management  and  by  him- 
self, there  is  danger  that  a  feeling  of  suspicion  may  arise  in  the 
minds  of  the  local  managers.  They  should  not  be  allowed  to 
feel  that  their  work  is  in  any  way  being  pried  into  in  an  un- 
friendly spirit.  The  fact  that  the  labor  auditor  is  present  in  the 
role  of  counselor  and  helper  should  be  stressed  to  the  maximum. 

Where  one  staff  member  of  an  organization  desires  to  carry  for- 
ward a  careful  study  of  labor  conditions,  the  proposal  may  or 
may  not  meet  with  the  approval  of  the  management.  If  it  does 
not,  the  management  has  in  the  long  run  to  be  "sold,"  just  as  it 
does  in  advance  of  any  other  innovation.  An  able  personnel 
manager  can,  nevertheless,  from  his  position  in  the  organization 
make  a  labor  audit  in  the  course  of  his  own  work  that  will 
be  surprisingly  complete,  even  though  he  has  not  access  to 
all  the  details  of  practice  and  policy  in  the  other  staff  depart- 
ments. As  a  matter  of  fact,  however,  an  up-to-date  management 
will  show  little  reluctance  to  having  the  personnel  department 
carry  on  careful  labor  studies.  On  the  contrary,  wise  managers 
are  making  it  a  definite  part  of  the  personnel  manager's  duties 
to  make  such  studies  at  periodic  intervals. 

Obviously  this  spirit  of  cooperation  and  helpfulness  must  ex- 
tend throughout  the  management  down  to  the  lower  executives. 
Much  valuable  information  about  the  concrete  application  of 
the  labor  policy  is  in  the  minds  and  experience  of  the  foremen, 
and  unless  they  have  lx?en  explicitly  assured  that  they  can  safely 
be  free  with  their  information,  this  important  source  of  experience 
and  facts  may  remain  virtually  untapped. 

Usually,  however,  lesser  executives  are  glad  enough  to  discuss 
their  problems  once  they  are  assured  a  sympathetic  audience. 
It  is  the  experience  of  consultants  in  all  branches  of  industrial 
work  that  many  members  of  the  executive  organization  of  a 
plant  are  so  situated  that  there  is  nothing  which  is  so  whole- 
some or  so  necessary  for  them  as  to  pour  out  their  troubles.  The 
labor  auditor  can  be  of  peculiarly  great  service  to  the  organization 


METHODS  OF  FACTORY  LABOR  ANALYSIS  297 

in  being  the  discreet  listener  to  the  trials  and  tribulations  of 
the  members  of  the  staff.  His  service  as  a  confessor  may  be 
a  by-product  of  the  audit,  but  it  is  one  of  its  most  valuable 
by-products. 

Thorough  analysis  of  the  industrial  relations  problem  requires 
also  a  direct  contact  with  workers  as  to  their  particular  problems, 
points  of  view  and  difficulties.  We  have  made  factory  studies 
under  different  conditions — in  plants  where  the  management 
felt  that  it  was  inadvisable  to  interview  the  workers  directly; 
in  plants  where  the  management  was  indifferent  as  to  whether  the 
workers  were  consulted  or  not;  and  in  plants  where  the  workers 
were  instrumental  in  having  the  study  made  and  were  deeply  in- 
terested in  seeing  to  it  that  all  the  facts  were  made  available. 
It  can  be  definitely  said  that  the  most  satisfactory  results  are 
obtainable  under  the  last  of  these  three  conditions. 

It  is  worth  while,  however,  to  mention  further  the  situation  in 
which  it  is  not  deemed  desirable  by  the  management  for  the 
consultant  to  have  direct  contact  with  the  workers.  This 
limitation  has  not  proved  as  serious  as  might  be  supposed.  It  is 
usual  to  find  among  the  foremen  and  other  executives  one  or 
more  who  through  long  acquaintance  with  the  company  can 
tell  a  graphic  story  of  its  successes  and  shortcomings  on  the 
labor  side.  In  almost  any  corporation  if  one  were  simply  en- 
gaged to  make  an  audit  of  the  executive  organization  including 
foremen,  one  could  lay  bare  many  of  the  difficulties  which  are 
hampering  right  personnel  relations.  But  to  limit  the  study  in 
this  way,  is  to  lose  one  of  the  conspicuous  educational  values  of 
the  audit. 

Among  the  employees  there  is  always  information  and  a  point 
of  view  toward  matters  under  examination,  which  is  illuminating 
and  suggestive  of  needed  changes.  Since  they  are  the  ones 
chiefly  affected  by  the  employer's  policies,  workers  are,  looking 
at  it  from  any  point  of  view,  preeminently  those  who  should  be 
questioned  and  consulted.  The  objection  made  by  employers 
who  do  not  want  their  workers  interviewed  is  that  it  will  stir  up 
trouble.  It  may  safely  be  said  that  this  fear  is  ungrounded  if 
the  auditor  is  a  person  with  reasonable  tact,  and  if  the  exist- 
ing conditions  are  not  already  so  aggravated  that  open  trouble 
is  inevitable. 

Manifestly,  the  most  satisfactory  results  are  to  be  had  where 
the  workers  are  a  party  to  the  audit.  One  of  the  most  informing 


298  PERSONNEL  ADMINISTRATION 

and  practically  useful  studies  which  we  ever  made  was  in  an 
organized  plant  where  representatives  of  the  trade  unions  were 
instrumental  in  having  the  study  made  because  of  the  dissatis- 
faction of  their  members  with  the  conditions  of  employment. 
The  auditor  met  with  a  representative  committee  from  the  whole 
plant  on  the  first  evening  and  got  a  general  sense  of  the  difficulties. 
Each  subsequent  evening  was  spent  in  conferring  with  a  delega- 
tion from  each  department  and  the  days  between  were  spent  in 
the  respective  departments,  checking  up  with  the  foremen  and 
other  executives,  the  testimony  obtained  on  the  previous  evening. 
At  the  end  of  the  study,  the  auditor  presented  his  general  con- 
clusions to  the  whole  group  verbally  and  talked  them  over  in- 
formally with  the  management.  He  then  wrote  the  final  report, 
which  was  instrumental  in  ironing  out  all  of  the  acute  troubles. 

As  a  practical  matter,  in  any  plant  which  has  any  appreciable 
degree  of  employee  organization,  but  where  an  audit  is  being 
undertaken  on  behalf  of  the  management,  it  is  most  advisable  that 
the  auditor  be  allowed  to  indicate  at  the  outset  to  the  employees' 
group  the  purpose  and  method  of  his  inquiry.  In  this  way  he 
can  at  once  set  at  rest  any  question  about  his  constant  presence 
in  the  plant,  or  suspicion  as  to  his  reason  for  being  there.  The 
positive  service  which  any  employees'  organization  can  be  to 
him  in  supplying  information  will  be  indicated  more  specifically 
in  connection  with  the  discussion  of  methods  of  conducting  the 
audit. 

Useful  as  the  labor  audit  check-list  is  as  an  instrument  of 
diagnosis,  it  achieves  maximum  usefulness  only  in  the  hands  of 
a  qualified  auditor.  It  may  be  conservatively  stated  that  the 
labor  audit  will  be  no  better  than  the  auditor.  Everything  will 
depend  upon  his  qualifications.  First  in  importance  should  be 
placed  his  ability  to  elicit  and  respect  the  confidences  of  the 
people  with  whom  he  confers.  In  other  words,  he  must  be  a 
person  of  a  reasonably  agreeable  personality;  he  should  be 
patient,  accurate,  dispassionate,  sympathetic,  tactful.  He  should 
be  discriminating  and  temperate  in  revealing  what  ho  knows;  he 
should  be  preeminently  gifted  with  a  teaching  sense  that  will 
enable  him  to  draw  people  out  and  inculcate  his  own  ideas  only 
BO  fast  as  the  individuals  and  the  organization  can  absorb  them. 
And  in  addition  to  these  more  personal  qualities,  certain 
definitely  intellectual  qualifications  are  necessary. 

It  seems  reanonable  to  assume  that  when  a  concern  makes  an 


METHODS  OF  FACTORY  LABOR  ANALYSIS  299 

initial  labor  audit,  or  keeps  a  perpetual  labor  audit,  it  does  so 
because  of  an  appreciation  of  the  importance  of  right  industrial 
relations.  It  does  so  because  it  recognizes  the  need  of  correction 
or  improvement.  But  correction  and  improvement  can  only 
take  place  if  a  concrete  comparison  is  constantly  being  made 
between  what  is  and  what  ought  to  be.  In  other  words,  the 
labor  audit  will  only  serve  its  purpose  if  it  is  in  the  hands  of  an 
auditor  who  comes  to  his  work  in  a  liberal,  progressive  and  well- 
informed  spirit.  An  effective  labor  audit  cannot  be  made  by  a 
person  of  reactionary  temperament  and  ideas.  This  is  truer  at 
the  present  moment  than  ever  before  in  the  history  of  the  indus- 
trial world.  For  the  auditor  has  to  see  each  organization's 
problem,  not  as  an  isolated  phenomenon,  but  as  part  of  a  world 
movement  of  liberalizing  and  humanizing  influences.  He  must, 
in  short,  have  a  reasonably  clear  conception  of  how  the  industrial 
relations  of  the  plant  could  be  run  with  greater  and  greater 
success  and  felicity,  if  only  his  recommendations  were  allowed 
gradually  to  have  effect.  If  the  audit  is  to  exercise  a  construc- 
tive influence — and  this  is  its  only  excuse  for  being — it  must  be 
made  by  a  person  who  is  a  practical  idealist,  who  keeps  himself 
informed  upon  all  developments  and  experiments  in  the  field  of 
industrial  relations  the  world  over,  and  who  is  able  by  the  weight 
of  facts  to  win  others  to  his  way  of  thinking. 

Methods  of  Conducting  the  Labor  Audit. — The  following 
statement  of  the  methods  to  be  employed  in  conducting  the 
labor  audit  is  made  from  the  point  of  view  of  the  outside  con- 
sultant. Some  problems  of  contact  which  are  serious  for  him 
will  undoubtedly  disappear  when  the  study  is  made  by  those 
within  the  plant.  Yet,  it  will  probably  be  true  that  up  to  a 
certain  point  the  personnel  manager  can  profitably  follow  much 
the  same  procedure  as  the  one  here  indicated. 

A  preliminary  word  of  warning  is  necessary,  however,  since 
it  is  literally  true  in  our  own  experience  that  in  no  two  organiza- 
tions has  the  analysis  been  pursued  in  identical  ways.  The 
approach  to  each  new  plant  is  a  journey  of  discovery  on  an  un- 
charted sea  and  the  auditor  must  be  prepared  to  watch  for 
every  clue  and  be  exceedingly  flexible  in  his  methods.  It  will 
be  valuable,  however,  for  him  to  have  two  or  three  general  points 
in  mind. 

He  should,  for  example,  be  sure  to  talk  with  those  executives 
who  "have  ideas"  on  the  labor  problem  of  the  factory.  These 


300  PERSONNEL  ADMINISTRATION 

individuals  may  not  be  found  administering  the  personnel  rela- 
tions but  they  are  to  be  found  in  some  capacity  in  almost  every 
plant.  In  the  second  place,  the  auditor  will  take  pains  to  plan 
his  campaign  of  interrogation  and  conference  in  such  a  way  as 
to  get  the  maximum  educational  results.  His  temptation  will  be 
to  adopt  the  attitude  that  he  is  there  simply  to  get  the  facts. 
Indeed,  this  is  perhaps  the  subtlest  danger  to  which  the  auditor 
may  become  a  victim.  It  will  be  the  line  of  least  resistance  for 
him  simply  to  draw  out  information  as  quickly  as  possible,  draw 
conclusions  in  his  own  mind,  write  as  effective  a  report  as  possible, 
setting  forth  the  facts  and  his  recommendations,  and  consider 
that  his  work  is  then  ended.  '  The  trouble  with  this  method  is 
that  it  is  likely  to  lead  to  the  futile  consequence  that  his  report  is 
simply  read  and  filed  away  without  action  being  taken,  or  without 
enough  action  being  taken  to  constitute  a  real  change  in  policy. 
Emphatically  the  process  of  making  an  audit  is  not  simply  the 
writing  of  a  report.  It  is  a  process  of  constant  education  through 
personal  contact,  conference,  discussion,  question  and  ansiver. 
Half  the  educational  value  is  on  this  personal  side;  and  to 
ignore  it  is  to  miss  the  real  opportunity  for  most  rapid  advance. 

In  short  the  auditor  must  sell  his  ideas  as  he  goes  along,  both 
by  the  way  in  which  he  asks  his  questions  and  by  the  way  in 
which  their  assent  to  the  facts  brings  the  executives  naturally 
to  an  acceptance  of  the  auditor's  conclusions. 

The  first  interview  will  naturally  be  with  the  highest  executive, 
with  whom  the  auditor  takes  up  especially  problems  of  the  determi- 
nation of  personnel  policy  and  the  nature  of  the  policy  under  which 
the  company  at  present  operates.  It  will  be  important  to  get 
from  him  as  clear  a  picture  as  possible  of  the  division  of  respon- 
sibility and  of  authority  in  the  organization.  In  this  connection 
it  will  be  helpful  to  secure  or  to  have  made,  an  organization 
chart  of  the  executive  organization  as  a  whole.  It  cannot  be  too 
greatly  stressed  that  at  the  bottom  of  many  personnel  problems 
is  the  fact  that  responsibility  is  vaguely  assigned,  and  that  au- 
thority is  not  clearly  designated  on  important  matters  of  adminis- 
tration. Indeed,  the  auditor's  efforts  in  the  direction  of  clarifying 
function  are  not  simply  indispensable  to  him;  they  are  invaluable 
to  the  company. 

The  labor  auditor  will  indicate  his  method  of  procedure  to  the 
chief  executive  and  will  ask  to  be  introduced  to  the  lesser  execu- 
tives with  whom  he  can  talk  to  advantage;  he  will  also  see  that 


METHODS  OF  FACTORY  LABOR  ANALYSIS  301 

the  top  executive  instructs  the  other  officials  to  put  necessary 
data  and  records  at  his  disposal.  Whether  or  not  all  such  tabu- 
lated matter  should  be  studied  next  by  the  auditor,  he  will  have 
to  decide  on  the  merits  of  the  individual  case.  Usually,  however, 
he  will  carry  on  his  interviews  and  factory  observations  with 
greater  point  if  he  has  that  grasp  of  the  outstanding  problems 
which  a  preliminary  study  of  the  records  may  reveal. 

Available  Records. — 'Turning,  therefore,  to  a  consideration  of 
the  records  and  printed  material  on  personnel  matters,  which  the 
auditor  should  examine,  we  find  the  following  data  to  be  of 
service: 

(a)  The  number,  causes  and  cost  of  accidents. 

(6)  The  amounts,  causes  and  cost  of  sickness. 

(c)  The  amounts,  causes  and  cost  of  occupational  disease. 

(d)  Figures  showing  the  relation  between  wages  and  output;  between 

hours  and  output;  between  labor  turnover  and  output. 
This  correlation  of  data  is  highly  significant.     It  may  not  always  be 
possible  to  secure  it;  but  there  is  unquestionably  one  of  the  most 
fertile  fields  for  statistical  refinement  in  this  problem  of  correlating 
the  figures  on  the  production  and  the  human  side  of  the  business. 

(e)  Length  of  employment  of  workers. 

It  is  important  to  know  what  percentage  of  workers  have  been  at 

work  for  a  given  length  of  time. 

(/)    Wage  groupings  by  (1)  amounts  both  in  terms  of  weekly  and  yearly 
incomes;  (2)  sex;  (3)  age;  (4)  length  of  service;  (5)  degree  of  skill. 

This  arrangement  of  wage  statistics  will  almost  invariably  throw 
light  upon  the  efficiency  of  the  factory's  payment  methods  and 
upon  any  serious  discrepancies  and  shortcomings  in  amounts  of 
pay.  Factories  do  not  usually  compile  their  figures  in  this  way,  but 
if  when  the  labor  auditor  commences  his  work  he  can  call  for  a 
certain  amount  of  clerical  assistance  in  the  factory,  a  good  deal  of 
this  data  can  be  collected  during  his  visit — usually  enough  to 
make  it  possible  for  him  to  have  a  fact  basis  for  his  discussion. 
(g)  Records  of  labor  turnover. 

These  records  to  be  significant  should  be  itemized  in  various  ways 
but  especially  by  departments,  sex,  length  of  service,  amounts 
of  pay,  etc. 

The  adequate  compilation  of  records  is  one  of  the  immediate 
ends  for  which  the  consultant  will  have  to  strive  with  some 
pains.  Many  plants  do  not  keep  records  of  the  above  character 
with  any  permanency  and  have  no  idea  what  the  situation 
is  regarding  these  personnel  facts.  It  is  not  until  the  signifi- 
cance of  more  adequate  control  over  these  important  items 
is  understood  that  a  proper  interest  in  this  type  of  statistical 
work  arises.  But  nothing  will  be  clearer  to  the  executive  who 


302  PERSONNEL  ADMINISTRATION 

has  seen  the  beneficial  results  of  a  more  careful  control  of 
production  costs,  than  that  a  certain  minimum  of  personnel  record 
figures  will  be  immensely  valuable. 

In  addition  to  the  existing  statistical  data  there  will,  of  course, 
be  a  certain  amount  of  documentary  material  which  the  auditor 
will  examine  with  profit  before  he  goes  into  the  plant.  He  will 
familiarize  himself,  for  example,  with  profit  sharing  arrangements, 
constitutions  of  mutual  benefit  societies  and  employees'  repre- 
sentation schemes,  minutes  of  meetings  of  foremen's  clubs  and 
employees'  organizations,  the  files  of  the  company  paper  or 
house  organ,  and  similar  sources  of  information  about  the 
different  activities  of  the  plant. 

Interviews  with  Executives. — The  wise  auditor  will  usually 
conduct  his  personal  interviews  with  the  executives  from  the  top 
down  in  the  order  of  the  authority  of  the  lesser  executives.  In 
these  interviews  he  will  in  many  cases  repeat  the  same  questions — 
questions  having  to  do  with  the  responsibility  and  authority 
of  the  individual,  those  aiming  to  make  clear  his  conception  of 
the  labor  policy  under  which  the  company  operates,  those  aiming 
to  secure  his  evaluation  of  the  success  of  that  policy.  The 
auditor  will  save  himself  considerable  misunderstanding  and 
will  avoid  confusion  if  he  says  specifically  to  executives  who  are 
outside  the  field  of  immediate  personnel  administration,  that  he 
is  not  talking  to  them  as  an  expert  in  their  field,  but  that  he  is 
speaking  to  them  only  in  his  capacity  as  a  labor  expert  anxious  to 
understand  how  their  problems  affect  the  labor  problem. 

In  the  course  of  such  interviews  he  will  necessarily  have  to 
go  through  a  good  deal  of  chaff  to  get  the  wheat,  since  every 
specialist  is  proud  and  eager  to  describe  the  technical  work  in 
which  he  excels;  and  it  is  only  with  difficulty,  and  often  inciden- 
tally, that  he  will  let  fall  any  information  which  throws  light  on 
the  labor  aspects  of  his  technical  problem.  For  this  reason 
the  method  of  direct  questioning  must  occasionally  give  way  to 
patient  waiting  for  an  executive  to  tell  his  own  story  in  his  own 
way. 

With  the  general  knowledge  of  plant  organization,  policy  and 
practice,  which  the  interviews  with  executives  should  afford,  the 
auditor  will  then  confer  individually  with  each  of  the  foremen. 
In  this  way  he  will  get  a  valuable  corroboration  or  denial  of  the 
statements  which  the  higher  executives  have  made.  He  is 
frequently  astonished  to  see  the  wide  discrepancies  between  the 


METHODS  OF  FACTORY  LABOR  ANALYSIS  303 

stories  which  the  higher  and  lower  executives  tell,  as  to  the  defini- 
tion of  responsibility  and  the  character  of  the  policy  under  which 
the  plant  is  operating.  The  labor  auditor  has  a  major  task  in 
helping  to  clarify  this  situation  and  remove  misunderstandings. 

But  in  the  interviews  with  the  foremen  he  will  concern  himself 
even  more  with  the  detail  of  the  individual  foreman's  methods  of 
running  his  department,  especially  on  its  labor  side.  It  is  one  of 
the  substantial  by-products  of  the  auditor's  work  that  he  comes 
to  have  a  fairly  good  knowledge  of  the  competence  of  the  various 
executives  for  the  jobs  they  have  in  hand.  At  the  least,  the 
auditor  will  know  which  executives  are  most  successful  in  carrying 
on  their  work  as  it  affects  the  labor  problem.  Finally,  the  value 
of  these  interviews  in  giving  the  executive  a  chance  to  state  his 
troubles  can  hardly  be  over-emphasized.  The  need  for  a  con- 
fessional in  industry  is  every  bit  as  great  as  certain  religious 
bodies  have  found  it  to  be  in  private  life. 

Attendance  at  Meetings. — The  auditor  will  also  get  much  light 
upon  the  practical  working  of  the  company's  human  relations 
work  if  he  attends  every  executives'  or  workers'  conference  or 
committee  meeting  which  takes  place  during  his  stay  in  the  plant. 
Not  infrequently  an  operating  committee  of  the  executive  staff 
has  daily  conferences  on  the  plant's  problems.  Attendance  at  a 
number  of  these  meetings  usually  brings  out  suggestive  informa- 
tion, even  though  many  of  the  problems  treated  have  no  direct 
bearing  upon  the  labor  question.  The  same  will  be  true  of 
foreman's  meetings,  councils  and  conferences,  whether  they  are 
brought  together  for  business  or  for  social  purposes.  If  there  are 
meetings  of  employees'  organizations  of  any  sort,  which  the  audi- 
tor can  attend  without  being  too  conspicuously  out  of  place,  it 
will  be  valuable  for  him  to  be  present. 

Finally,  of  course,  there  is  the  method  of  direct  observation  of 
conditions  and  procedure.  The  auditor's  eyes  are  always  open 
not  alone  to  matters  of  physical  arrangement  and  convenience, 
but  to  the  going  methods  and  that  indefinable  thing,  the  atmos- 
phere of  the  shop,  which  subtle  as  it  is,  frequently  tells  much 
about  the  workers'  attitude. 

In  short,  the  auditor  must  have  his  wits  about  him  at  every 
moment  of  the  day  to  discover  ways  and  means  of  acquainting 
himself  with  the  effects  of  the  current  labor  policy  of  the  concern. 

Selected  References 

TEAD,  ORDWAY.     The  Labor  Audit.     Bulletin  43,  Federal  Board  for  Vo- 
cational Education,  Washington,  1920. 


CHAPTER  XXII 
THE  LABOR  AUDIT  CHECK-LIST 

The  check-list  from  which  the  investigator  takes  his  cue  as  to 
the  subjects  to  be  covered  in  the  labor  audit,  might  conceivably 
be  created  afresh  by  each  investigator  in  the  light  of  the  problem 
he  is  about  to  confront.  Naturally  some  modification  in  sub- 
ject matter  is  necessary  in  every  different  situation.  But  there 
is  still  a  good  case  to  be  made  in  behalf  of  a  check-list  which  will 
be  reasonably  definite,  standardized,  and  exhaustive  in  character. 
It  is  definitely  not  our  assumption  that  the  form  of  check-list 
here  discussed  is  necessarily  the  best  that  can  be  devised.  It  is 
admittedly  a  tentative  and  trial  attempt  toward  a  systematic 
itemization.  We  are  not  even  interested  in  attempting  to  de- 
fend the  present  arrangement,  since  further  experience  is  almost 
certain  to  lead  to  a  rearrangement  of  topics.  Its  use  here  is 
simply  illustrative  and  suggestive  of  one  possible  way  of  devel- 
oping a  method  for  factory  study.  For  it  is  less  important  what 
standard  form  of  procedure  is  agreed  to,  than  that  some  stand- 
ard form  of  procedure  should  be  agreed  to. 

It  may  fairly  be  added,  however,  that  the  present  topical 
arrangement  has  been  used  in  the  study  of  a  considerable  number 
of  plants  in  over  fifteen  industries;  and  it  has  been  found  possible, 
under  the  headings  and  sub-headings  of  the  labor  audit  as  here 
outlined,  conveniently  to  group  and  discuss  all  the  facts  regarding 
any  situation  which  it  has  been  necessary  to  analyze. 

No  one  familiar  with  the  extraordinary  inter-relation  of  sub- 
jects in  this  field  will  deny  that  any  grouping  of  headings  is  at  best 
arbitrary.  We  shall,  therefore,  only  attempt  to  explain  briefly 
why  subjects  are  grouped  as  they  are;  and  shall  not  attempt,  nor 
is  it  possible  in  a  chapter  of  reasonable  length,  to  state  exhaus- 
tively what  questions  should  be  asked  under  each  of  the  main 
headings.  The  treatment  throughout  aims  primarily  to  be  sug- 
gestive of  a  method  of  procedure. 

Acknowledgment  should  be  made  at  this  point  to  the  late 
Robert  G.  Valentine  who  was  probably  more  instrumental  than 
any  other  person  in  giving  practical  form  to  the  idea  of  a 

304 


THE  LABOR  AUDIT  CHECK-LIST  305 

labor  audit.  The  arrangement  of  the  nineteen  major  topics  was 
his,  it  was  in  association  and  partnership  with  him  and  Richard 
B.  Gregg  that  the  earlier  check-lists  were  worked  out.  We  have 
retained  this  arrangement  of  topics,  both  for  practical  use  in 
plant  studies  and  in  teaching,  not  because  it  is  thought  to  be 
perfect,  but  because  it  is  valuable  to  have  a  grouping  of  subjects 
which  is  adhered  to  as  standard  practice  over  a  period  of  months 
and  years.  And  it  is  with  this  idea  in  mind  rather  than  with  any 
thought  of  being  inflexible  or  dogmatic  as  to  a  schematic  arrange- 
ment, that  we  shall  discuss  the  contents  of  a  labor  audit. 

Contents  of  a  Labor  Audit. — The  topics  of  the  labor  audit  may 
conveniently  be  grouped  under  three  major  headings.  (1)  The 
employment  organization,  which  will  be  treated  in  the  first  seven 
topics.  (2)  The  outside  economic  and  industrial  forces  which 
the  management  cannot  control  but  to  which  it  has  to  make  ad- 
justment, treated  in  topics  8  through  16.  And  (3)  the  wages 
and  total  earnings,  treated  in  17  through  19.  This  explanation 
will  help  to  make  clear  the  reason  for  the  order  in  which  the 
individual  topics  occur. 

It  will  be  convenient  to  list  at  once  the  nineteen  topics  with 
their  major  sub-headings  and  occupy  the  rest  of  the  section  in 
indicating  in  a  general  way  the  subjects  to  be  covered  under 
these  specific  headings. 

1.  Physical  working  conditions 

A.  Fire  hazards 

B.  Accident  hazards 

C.  Ventilation  and  heating 

D.  Lighting 

E.  Cleaning  and  drinking  water 

F.  Sanitary  equipment 

G.  Seating  and  rest  rooms 
H.  Dressing  rooms 

I.  Noise  and  vibration 
J.  Health  equipment,  hospital,  etc. 
K.  Factory  exterior 

2.  Labor  turnover 

3.  Work  and  job  analysis 

4.  Sources  of  labor  supply 

5.  Methods  of  selection 

6.  Methods  of  starting  at  work 

7.  Training 

A.  Job  instruction 

B.  Foreman  instruction 

C.  English  instruction 
20 


306  PERSONNEL  ADMINISTRATION 

D.  Inspection 

E.  Transfer 

F.  Promotion 

G.  Grievances 
H.  Shop  control 

1.  Discharge 
J.  Suggestion  systems 
K.  Relations  to  public  schools 

8.  Economic  beliefs 

9.  Employers'  associations 

10.  Employees'  associations 

11.  Trade  unions 

12.  Joint  relations 

13.  Labor  legislation 

14.  Court  decisions 

15.  Labor  law  administration 

16.  Community  relations 

17.  Form  and  efficiency  of  management 

A.  Production 

B.  Sales 

C.  Finance 

D.  Personnel 

E.  Coordination  of  staff  departments 

18.  Amounts  and  methods  of  pay 

19.  Other  provisions  for  employees 

A.  Accident  compensation 

B.  Sickness  insurance 

C.  Unemployment  insurance 

D.  Pensions 

E.  Life  insurance 

F.  Savings  facilities 

G.  Purchasing 
H.  Housi  ng 

I.  Transportation 

J.  Public  health 

.  K.  Recreational  facilities 

\^        L.  Educational  facilities 

'  1.  Physical  Working  Conditions. — It  is  obvious  that  a  matter 
of  primary  concern  to  the  auditor  is  the  whole  physical  equip- 
ment and  surroundings  in  which  the  employee  works.  These 
should  be  treated  not  simply  from  the  point  of  view  of  the  worker's 
consciousness  or  definite  expression  of  satisfaction  or  dissatis- 
faction, since  the  worker  may  not  be  trained  to  detect  unsatis- 
factory working  surroundings.  The  check-list  should  be  made  on 
a  basis  of  a  really  scientific  knowledge  of  what  constitutes  health- 
ful, safe  and  productive  working  conditions  under  which  workers 


THE  LABOR  AUDIT  CHECK-LIST  307 

may  properly  be  asked  to  labor.  We  made  at  one  time  a  labor 
audit  of  a  plant  where,  to  the  casual  observer,  the  industrial  re- 
lations appeared  satisfactory.  The  shop  was  a  union  shop  which 
had  worked  under  collective  agreements  for  years  without  fric- 
tion. But  from  the  point  of  view  of  safe,  scientific  standards 
and  modern  factory  working  conditions  there  certainly  was  much 
to  improve,  even  though  none  of  those  directly  interested  had 
complained  or  were  especially  alive  to  any  deficiencies. 

Since  in  the  chapter  on  standards  of  working  conditions  we 
have  stated  the  most  important  of  the  items  in  this  field,  it  will 
be  unnecessary  here  to  do  more  than  refer  the  reader  to  the  list 
of  topics  there  treated,  as  constituting  the  check-list  on  working 
conditions. 

Only  two  additional  observations  need  be  made.  There  are, 
of  course,  legal  standards  governing  many  conditions.  The 
labor  audit  is  really  auditing  those  standards  and  their  actual 
enforcement  in  the  plant  in  question;  for  too  generally  the 
disposition  among  managers  is  to  feel  that  they  are  absolved 
from  further  anxiety  about  factory  housekeeping  because  the 
law  makes  certain  provisions  and  there  are  periodic  official 
inspections. 

Again,  the  labor  auditor  is  not  attempting  specific  advice  in 
complete  detail  on  all  items  of  working  conditions.  He  is  rather 
trying  to  see  the  work  of  all  the  technical  experts  from  the  point 
of  view  of  the  result  of  their  expert  work  on  the  total  success  of  the 
company's  labor  policy.  His  is  the  last  check  on  the  relation 
of  all  items  to  employees'  goodwill  and  interest. 

2.  Labor  Turnover. — The  purpose  of  the  section  on  labor 
turnover  is  to  discover  the  facts  about  the  amounts,  causes  and 
costs  of  shifting  among  the  employees  and  to  consider  the  most 
immediate  remedies.  Where  no  records  are  kept,  the  facts  which 
this  section  contains  are  made  the  basis  for  an  argument  in 
behalf  of  systematic  record  keeping. 

Properly  analyzed  the  data  on  labor  turnover  should  furnish 
general  clues  to  the  auditor  as  to  conditions  in  the  plant  which 
require  special  attention.  This  means,  of  course,  that  turnover 
figures  should  be  analyzed  before  the  actual  plant  inquiry.  A 
simple  device  that  the  auditor  can  resort  to  in  a  plant  with  no 
records  is  to  get  individual  foremen  to  mark  down  the  number  of 
people  who  leave  their  departments  during  the  time  that  the 
auditor  is  there.  In  this  way  some  approximate  figures  can  be 


308  PERSONNEL  ADMINISTRATION 

obtained  to  indicate  to  the  management  how  much  shifting  is 
taking  place  and  how  necessary  further  records  are. 

In  some  cases,  the  problem  of  the  cost  of  labor  turnover  can 
profitably  be  dwelt  upon.  If  there  are  conditions  of  high  turn- 
over at  great  expense  which  the  company  does  not  appreciate, 
there  is  value  in  suggesting  the  numerous  elements  of  its  high  cost. ' 

3.  Work  and  Job  Analysis. — It  is  the  purpose  of  this  section 
to  give  a  statement  of  the  character  and  elements  of  the  work 
process,  of  the  time  factors,2  of  the  effects  of  the  work  on  the 
workers,  and  of  the  place  and  uses  of  job  analysis.3 

Having  a  background  of  the  conditions  of  the  plant,  of  the 
character  of  the  work  and  the  hours,  the  auditor  can  naturally 
turn  his  attention  to  the  methods  of  securing  the  proper  type  of 
workers  in  sufficient  numbers. 

4.  Sources  of  Labor  Supply. — In  this  section  the  auditor  is 
considering  the  problem  of  securing  enough  workers  of  the  right 
quality.     Methods  of  getting  in  touch  with  local  agencies  of  all 
sorts  are  considered  in  order  to  determine  whether  there  has 
been  the  best  possible  conscious  cultivation  of  cordial  relations 
with  resident  workers.     In  the  recommendations,  it  is  necessary 
in  some  cases  to  indicate  how  the  plant's  reputation  in  the  com- 
munity can  be  improved. 

6.  Methods  of  Selection. — An  examination  of  methods  of 
selection  of  workers  means  that  the  auditor  has  considered 
whether  there  are  any  existing  and  defined  standards  of  employ- 
ment for  the  given  jobs — standards  of  health,  age,  education, 
previous  experience,  etc.  He  ascertains  also  whether  actual 
specifications  of  the  qualifications  needed  for  different  jobs  have 
been  made  and  are  in  use  by  the  interviewer.  The  degree  of 
centralization  of  the  selecting  function,  methods  of  following  up 
those  selected — these  are  matters  that  are  reviewed  in  detail. 
If  there  are  special  selective  tests  in  existence — mental  testa, 
physical  examinations,  or  trade  tests — the  expediency  of  these  is 
considered;  and  if  some  unused  type  of  test  is  believed  to  be 
desirable,  it  is  stated  with  the  reasons. 

6.  Methods  of  Starting  at  Work. — Under  existing  conditions 
this  section  usually  becomes  an  argument  for  instituting  some 
more  definite,  formal  and  courteous  method  of  introducing  the 

1  See  Chapter  XX. 

1  Discussed  in  Chapter  VII. 

1  Discussed  in  Chapters  XVIII  and  XIX. 


THE  LABOR  AUDIT  CHECK-LIST  309 

worker  to  his  foreman,  his  fellow-workers  and  his  duties,  than  is 
customarily  used.  Facts  about  present  methods  of  getting 
workers  from  the  interviewer  to  the  job  are  usually  easy  of 
statement,  since  little  or  nothing  is  done  about  it  in  many  plants. 
It  is  necessary  to  indicate  that  the  new  worker  often  wastes 
much  time  in  starting  at  work  if  he  is  not  familiarized  with  the 
plant's  layout  and  rules.  Moreover,  the  value  to  be  obtained 
from  having  a  worker's  first  impressions  pleasant  is  substantial. 

7.  Training. — The  liberal  labor  auditor  realizes  that  the  per- 
sonnel activities  of  the  plant  will  be  successful  to  the  extent  that 
they  are  saturated  with  the  training  motive.  In  dealing  with 
people  in  a  factory  the  management  is  touching  individuals  of 
whom  it  is  literally  true  that  if  they  do  not  grow  and  advance 
they  definitely  become  static  and  lacking  in  vitality.  Recognition 
of  the  educational  motive  means  simply  an  appreciation  that 
growth  and  development  are  normal  demands  of  human  nature; 
that  since  the  worker  spends  the  major  part  of  his  waking  hours 
in  the  plant,  there  must  during  those  hours  be  some  opportunity 
for  education  and  growth  and  widened  horizons. 

It  will  be  especially  true  that  the  most  successful  conduct  of 
the  formal  training  work,  the  administration  of  transfer  and 
promotion,  consideration  of  discharges  and  of  the  rules  under 
which  the  shop  operates,  will  all  require  an  active  use  of  this 
training  motive.  For  this  reason  these  subjects  are  grouped 
under  this  heading.  All  personal  adjustments  will  be  handled 
most  successfully  when  it  is  realized  on  both  sides  that  there  is 
something  to  be  learned  before  a  satisfactory  adjustment  can  take 
place. 

A.  Job   Instruction. — The    effectiveness    of    the   actual    job 
instruction  must  first  be  established,  and  if  there  exists  any 
formal  training  procedure,  its  working  and  success  must    be 
examined.     If  there  is  no  formal  instruction,  it  is  almost  always 
true  that  the  facts  indicate  the  need  for  such  provision. 

B.  Foreman  Instruction. — The  whole  problem  of  foremanship 
is  considered  under  this  topic,  because  of  the  major  place  that 
formal  training  must  take  in  solving  the  problem  of  foremanship 
as  it  today  presents  itself.1 

C.  English  Instruction. — The  necessity  for  English  and  naturali- 
zation instruction  varies  greatly  from  one  community  to  another. 
The  important  thing  for  the  auditor  is  to  estimate  the  success  of 

1  Discussed  in  Chapter  XII. 


310  PERSONNEL  ADMINISTRATION 

the  provisions  that  are  being  made,  and  to  point  to  the  need  for 
instruction,  preferably  under  community  auspices,  where  it  is  not 
now  provided  for  non-English  speaking  workers. 

D.  Inspection. — In  so  far  as  inspection  work  demands  that  the 
product  be  returned  to  the  worker  and  its  quality  discussed  with 
him,  this  is  definitely  a  work  of  training. 

E.  Transfer. — Here  is  considered  the  company's  policy  regard- 
ing transfer.     The  method  of  handling  this,  and  the  degree  to 
which  it  is  encouraged  in  order  to  give  variety  to  the  work,  are 
to  be  considered. 

F.  Promotion. — It  is  necessary  to  know  whether  or  not  the 
company  has  any  deliberate  promotion  policy.     If  it  has  not, 
it  is  usually  plain  that  a  legitimate  source  of  stimulus  is  being  lost. 
And  if  there  is  a  promotion  system,  it  is  necessary  to  know  how 
effectively  it  works  to  equalize  opportunity,  and  how  the  policy 
and  its  operation  are  made  clear  to  the  new  worker. 

G.  Grievances. — It  is  important  to  know  how  grievances  are 
handled.     If  there  exists  some  form  of  shop  organization,  it  is 
probable  that  grievances  are  handled  through  committee  action, 
in  which  case  this  problem  would  be  taken  up  in  connection  with 
topic  10,  "Employees' Associations."     But  if  no  such  machinery 
exists,  it  is  necessary  to  know  what  provision  the  company  makes 
for  hearing  and  discussing  minor  differences,  personal   malad- 
justments and  major  disputes  with  its  workers. 

H.  Shop  Control. — Similarly,  with  the  question  of  shop  rules, 
questions  arise  concerning  smoking  in  the  shop,  tardiness,  un- 
necessary absenteeism,  quarreling,  drunkenness  on  the  premises, 
and  other  matters  usually  spoken  of  under  the  head  of  "  discipline." 

I.  Discharge. — The  method  of  handling  discharge  is  most  im- 
portant. If  the  function  still  rests  absolutely  in  the  hands  of 
foremen,  it  is  necessary  to  find  out  how  much  discharge  there  has 
been  in  order  to  determine  whether  the  centralizing  of  this 
function  would  not  result  in  its  appreciable  reduction.  It  is 
further  necessary  to  know  what  the  company  considers  causes 
for  discharge,  what  knowledge  the  employees  have  of  those  causes, 
and  what  voice  they  have  had  in  determining  what  causes  shall 
be  effective. 

J.  Suggestion  Systems. — Suggestion  systems  administered 
in  an  intelligent  way  may  be  definitely  a  part  of  the  educational 
procedure  of  the  plant.  It  is  therefore  useful  to  study  the  work- 
ing of  such  systems  in  this  connection.1 

1  Sec  Chapter  XV. 


THE  LABOR  AUDIT  CHECK-LIST  311 

K.  Relations  to  Public  Schools. — More  and  more,  as  continua- 
tion schools  are  developed  and  as  vocational  courses  are  given, 
it  will  be  necessary  for  plants  to  have  close  connections  with  the 
public  educational  machinery.  And  it  should  be  a  definite  part 
of  the  labor  auditor's  study  to  see  that  this  relationship  is  being 
maintained  at  maximum  usefulness. 

Finally,  the  question  of  the  administration  of  all  training  work 
arises.  The  extent  to  which  the  administration  of  the  training 
is  centralized,  the  competence  of  the  directing  head,  and  the  scope 
of  the  powers  given  to  him,  all  require  consideration. 

8.  Economic  Beliefs. — Obviously,  the  dominating  beliefs  of 
management  and  workers  will  have  a  considerable  influence  in 
determining  the  labor  policy  and  practice  of  the  plant.  The 
attempt  in  this  section  should  be  to  set  down  tactfully,  but  can- 
didly, those  elements  of  the  attitude,  point  of  view,  and  opinions 
of  the  management  which  are  especially  inimical  to  successful 
industrial  relations.  Where  there  are  strong  beliefs  which  have 
the  effect  of  fixed  ideas,  it  is  necessary  to  make  explicit  acknowledg- 
ment of  this,  in  order  that  those  directly  interested  may  know  the 
limitations  under  which  their  work  is  being  carried  on. 

We  have  made  investigations  for  a  manufacturer  who  believes 
that  a  minimum  wage  based  on  the  cost  of  living  is  "economically 
unsound" — that  it  is  contrary  to  the  fundamental  "economic 
law  of  supply  and  demand."  In  such  a  case,  it  does  little  good 
to  recommend  that  the  employer  fix  a  minimum  wage  in  his 
factory  which  takes  into  account  the  cost  of  living.  The  more 
immediate  task  is  to  try  to  show  such  a  man  the  way  in  which  his 
belief  complicates  his  own  labor  situation  and  detracts  from  the 
efficiency  of  his  plant.  At  least  it  is  of  value  to  have  the  em- 
ployer advised  that  one  of  his  pet  beliefs  is  exercising  a  handi- 
capping influence  in  his  business. 

It  is  no  less  true  that  the  underlying  beliefs  of  employees  are 
conditioning  factors.  As  such  beliefs  are  not  alway  held  unani- 
mously, it  is  less  easy  to  get  a  clear  picture  of  this  situation.  But 
where,  to  take  a  not  unusual  example,  there  is  a  body  of  workers 
impressed  with  the  belief  that  they  must  work  slowly  in  order  to 
distribute  the  work  among  themselves  and  to  keep  it  going 
through  slack  seasons  as  long  as  possible,  you  have  an  attitude 
which  must  be  openly  faced,  its  causes  examined,  and  the  possible 
remedy  considered. 

It  is  immensely  wholesome  and  helpful  to  have  controlling 


312  PERSONNEL  ADMINISTRATION 

motives,  which  are  often  rather  vague,  crystallized  into 
concrete  shape  and  set  down  in  black  and  white  for  examina- 
tion. This  process  is  often  the  first  step  toward  a  successful 
re-examination  of  the  evidence  and  toward  a  desire  to  base 
beliefs  on  an  examination  of  the  facts,  rather  than  on  ideas 
absorbed  through  one's  environment. 

It  is  sometimes  valuable  to  point  out  in  this  section  that  the  em- 
ployer has  not  made  sufficient  provision  for  keeping  himself  in- 
formed on  the  currents  of  ideas  and  activities  at  work  in  the 
modern  world.  It  usually  takes  a  certain  amount  of  evidence 
to  convince  managers  that  it  is  good  business  for  them  to  under- 
stand the  economic  forces  or  influences  which  are  either  directly 
or  potentially  affecting  their  plant,  and  to  which  they  must  of 
necessity  adjust  themselves — forces  which  are  more  varied  and 
more  active  today  than  ever  before. 

9.  Employers'  Associations. — This  section  calls  for  a  statement 
of  the  organized  relationships  which  the  employer  has  with  other 
employers  in  the  industry  and  in  the  locality.     It  is  especially 
important  to  understand  the  policies  of  these  organizations  which 
affect  the  industrial  relations  of  the  members'  individual  plants. 
If,  for  example,  a  company  belongs  to  an  association  of  manu- 
facturers which  is  strongly  anti-union,  that  is  an  important  fact 
to    know.     If,    as    sometimes    happens,    this   sentiment   leads 
employers  to  the  use  of  a  black-list  and  of  private  detectives  in 
their  plants,  such  a  state  of  affairs  is  a  fundamentally  modifying 
influence  in  the  personnel  relations  of  the  company.     And  until 
such  connections  are  known  and  the  policies  to  which  they  lead 
understood,  some  of  the  most  subtle  influences  will  be  obscured. 

10.  Employees'  Associations. — It  is  essential  to   know  what 
provision  exists  among  employees  for  organized  action  for  any 
purpose.     In  this  section  will  therefore  be  considered  the  work 
and  success  of  every  organization  which  is  confined  in  its  member- 
ship to  the  employees  of  the  one  plant.     If  there  is  no  organiza- 
tion of  employees,  the  question  may  well  be  raised  in  the  light  of 
the  facts,  whether  an  organization  of  employees  might  not  be 
advisable  in  order  that  certain  matters  of  personnel  relations 
might  be  handled  with  more  satisfaction  where  free  channel  of 
communication  exists  than  where  there  is  no  opportunity  for 
joint  conference. 

If,  on  the  other  hand,  there  are  active  employees'  organizations, 
it  is  necessary  to  study  them  with  some  care,  especially  since  the 


THE  LABOR  AUDIT  CHECK-LIST  313 

tendency  to  introduce  schemes  of  employees'  representation  from 
the  top  down  makes  it  uncertain  whether  such  bodies  will  be 
really  autonomous  and  vocal  of  the  workers'  problems  and  desires. 

11.  Trade  Unions. — The  first  question  which  arises  regarding 
trade  unions  is  whether  there  is  a  national  union  of  workers  in 
the  industry  in  question.     The  auditor  should  know  also  whether 
the  unions  have  local  branches  in  the  neighborhood  of  the  plant. 
He  will  further  inquire  as  to  whether  the  management  is  familiar 
with  the  personnel  and  temper  of  the  leaders  of  such  unions,  and 
what  relationship  and  attitude  exists  between  employers  and 
union  leaders. 

12.  Joint  Relations. — Having  established  the  fact  that  there 
are  or  are  not  unions  which  might  be  dealt  with,  the  next  ques- 
tion is:  Are  existing  unions  dealt  with  and  on  what  terms?    This 
leads  to  an  analysis  of  existing  collective  bargains,  written  and 
unwritten. 

In  plants  where  no  joint  relations  with  the  unions  exist,  but 
where  the  extent  of  organization  among  the  workers  makes  it 
appear  to  the  auditor  that  there  would  be  real  business  values  in  a 
collective  bargain,  the  arguments  for  such  a  relationship  would  be 
included  in  this  section. 

13.  Labor  Legislation. — This  topic,   together  with  the  next 
two,  has  regard  for  the  relation  of  the  factory  to  the  law.     In  large 
and  thoroughly  organized  corporations,  it  would  be  true  that  the 
corporation's  counsel  might  handle  certain  of  the  questions  here 
raised.     But  as  a  matter  of  checking  up  conditions,  the  auditor 
must  know  what  interest  the  company  takes  in  labor  legislation 
in   its  formative   stages.     Has  the   company,  in  other  words, 
some  organized  way  of  following  labor  legislation  and  of  acquaint- 
ing itself  with  the  practical  effect  of  such  legislation  upon  the 
industry? 

14.  Court   Decisions. — The   same   question   arises   regarding 
court  decisions.     Has  the  company  some  organized  method  of 
acquainting  itself  with  important  court  decisions  that  might 
modify  the  operation  of  personnel  policies  within  the  plant? 
Especially  is  it  true,  in  matters  relating  to  compensation  law, 
that  court  decisions  have  an  important  bearing  on  the  operating 
policy  of  a  plant. 

15.  Labor  Law  Administration. — The  administration  of  the 
labor  law  from  the  factory  point  of  view  means  that  there  has 
to  be  some  executive  delegated  to  receive  the  various  factory 


314  PERSONNEL  ADMINISTRATION 

inspectors,  confer  with  them,  and  consider  their  recommenda- 
tions or  mandates.  This  is  an  important  function,  and  study  of 
the  plant's  organization  is  necessary  to  find  out  what  provision 
the  company  makes  for  administering  the  labor  law. 

16.  Community    Relations. — Subjects     having    to    do    with 
community  policies,  but  which  have  an  important  bearing  on  the 
plant,  are  considered  under  this  section — if  they  have  not  been 
more  specifically  covered  in  other  connections.     Such  matters 
as  taxation  and  assessment,  tariffs,  and  other  less  classifiable 
subjects  are  treated  here. 

17.  Form  and  Efficiency  of  Management. — It  is  the  purpose 
of  this  section  to  consider  in  what  ways  the  form  and  efficiency 
of  the  operating  management  in  the  major  departments  of  the 
business,  reflect  in  any  adverse  way  upon  the  successful  adminis- 
tration of  personnel  relations.     The  auditor  is  not,  of  course, 
considering  problems  of  production,  sales  and  finance  as  an  expert 
on  these  subjects.     He  should  most  certainly  be  qualified  to 
study   these   other  branches  of  management  intelligently;  but 
as  a  labor  auditor  his  task  is  to  determine  how  existing  practices 
in  these  related  fields  exert  detrimental  influence  on  the  adminis- 
tration of  labor  relations. 

A.  Production. — In  matters  of  production,  it  becomes  evident 
with  a  little  reflection  that  if  methods  of  production  control  are 
crude,  so  that  work  does  not  flow  smoothly  from  department 
to  department,  or  if  methods  of  machinery  maintenance  are  so 
insufficient  that  equipment  is  always  breaking  down,  the  workers 
are  definitely  handicapped  by  these  conditions.  Since  this 
problem  of  efficient  shop  organization  is  at  the  heart  of  the 
problem  of  sound  and  amicable  relations,  the  auditor  should 
take  time  to  probe  as  carefully  as  he  can  into  any  failure  of 
the  production  organization  to  function  smoothly  lint  it  should 
l>e  understood  throughout  that  he  is  not  primarily  interested  in 
criticizing  production  methods  as  such,  that  he  is  not  an 
"efficiency  engineer." 

The  audit  undoubtedly  can  perform  one  of  its  most  educa- 
tional services  by  an  exposition  of  the  vital  relation  Ix-tween  the 
proper  administration  of  these  other  staff  functions  and  the 
jK^rsonnel  function.  And  usually  the  most  time-consuming  and 
significant  part  of  the  audit  will  be  this  effort  to  understand  the 
extent  to  which  inadequacies  in  production  methods  arc  giving 
rise  to  difficulties  and  complaints  on  the  part  of  the  workers. 


THE  LABOR  AUDIT  CHECK-LIST  315 

B.  Sales. — The  problem  of  sales  as  it  affects  the  labor  relations 
of   the   plant   is  usually  seen  most  vividly  in  seasonal  trades. 
It  can  be  said  without  fear  of  contradiction  that  today  firms 
whose  selling  policy  is  reflected  in  spasms  of  irregular  and  over- 
time work  are  handicapped  at  a  vital  point  in  trying  to  establish 
cordial  relations  with  employees;  since  one  of  the  first  elements  of 
sound  relationship  is  security  in  the  tenure  of  employment. 

C.  Finance. — It  may  be  less  clear  to  the  employer  of  the  old 
school  that  problems  of  finance  have  a  bearing  upon  his  labor 
difficulties.     But  so  widely  is  financial  news  disseminated  today 
that  the  annual  statement  of  any  large  corporation  appearing 
on  the  financial  pages  of  the  press  is  at  once  seen  by  the  workers 
of  the  corporation.     One  would  indeed  credit  them  with  extra- 
ordinary stupidity,  if  they  did  not  relate  facts  of  financial  pros- 
perity to  their  own  demands.     It  must  inevitably  come  home 
with  greater  and  greater  force  to  all  close  students  of  the  labor 
problem  that  facts  about  the  financial  condition  of  a  corporation 
do  throw  considerable  light  upon  its  labor  problem.     One  should 
know,  for  example,  what  burden  of  watered  stock  the  corporation 
is  carrying,  what  its  policy  is  regarding  amounts  set  aside  for 
surpluses,  depreciation  and  reserves. 

D.  Personnel. — Under  this  heading  is  analyzed  and  evaluated 
the  existing  personnel  policy  and  organization  of  the  factory  as  a 
whole.     The  competency  of  the  members  of  the  personnel  staff, 
the  adequacy  of  this  staff  to  meet  the  needs,  and  the  success  of  its 
policies,  will  be  treated.     One  of  the  most  important  problems 
to  consider  here  is  the  method  of  determining  personnel  policy. 
It  is  necessary  to  know  to  whom  the  personnel  manager  is  re- 
sponsible and  who  is  responsible  with  him  for  transmitting  the 
policy  to  all  other  executives  in  the  organization. 

E.  Coordination   of  Staff  Departments. — This   leads  properly 
to  a  consideration  of  how  the  policies  of  different  staff  depart- 
ments of  the  business  are  correlated.     The  tendency  is  wide- 
spread for  one  or  another  of  the  staff  departments — depending  to 
a  certain  extent  upon  the  strength  of  the  personalities  involved — 
to  dominate  the  whole  organization.     It  is  necessary  to  under- 
stand clearly  how  policies  of  selling,  production  and  all  the  rest 
should  be  related  to  each  other  in  order  to  make  the  organization 
a  harmonious  unit. 

No  less  important  is  a  discussion  of  the  way  in  which  adopted 
policies  are  transmitted.     It  is  being  increasingly  realized  today 


316  PERSONNEL  ADMINISTRATION 

that  the  personnel  department,  for  example,  is  successful  to 
just  the  extent  that  it  gets  its  accepted  policies  into  action 
within  the  factory.  And  one  of  the  most  valuable  educational 
uses  which  the  audit  can  serve  is  to  point  out  to  dominating 
and  overbearing  executives  on  the  selling  or  financial  side  of 
the  business,  the  plain  fact  that  they  are  acting  in  ways  which 
may  seriously  handicap  the  maintenance  of  productive  labor 
relations. 

18.  Amounts  and  Methods  of  Pay. — It  is  important  to  know 
how  much  workers  earn;  both  what  they  receive  in  the  pay 
envelope  and  what  additional  indirect  compensations  they  get. 
The  auditor  will  explain  to  the  company  why  it  is  that  the 
workers'  annual  income  is  of  more  significance  from  his  point 
of  view  than  the  wage  rate.  Moreover,  he  will  undoubtedly 
want  to  bring  the  wage  figures  into  more  significant  groupings 
than  mere  flat  weekly  wage  amounts.  To  be  intelligible  the 
wage  amounts  should  be  grouped  by  age,  sex,  kind  of  work, 
and  length  of  service  of  the  worker.  It  is  only  with  the  infor- 
mation in  this  form  that  the  auditor  is  able  to  pass  any  judgment 
upon  the  question  of  the  amounts  of  pay.  He  will  reserve 
judgment,  however,  until  he  has  familiarized  himself  with  any 
local  conditions  which  may  make  the  cost  of  living  vary  from  the 
cost  in  other  localities. 

From  the  point  of  view  of  the  workers'  attitude,  the  methods 
of  pay  may  be  almost  as  important  as  the  amount.1 

Clearly  no  reasonable  opinion  can  be  expressed  alxnit  a  com- 
pany's payment  policy  until  something  is  known  of  the  prosperity 
of  the  company;  and  in  some  cases  of  the  entire  industry.  The 
idea  has  unquestionably  gained  wide  acceptance  that  the  lowest 
wage  paid  should  be  sufficient  to  assure  a  reasonably  decent  living 
to  the  worker.  And  the  idea  is  gaining  rapid  headway,  that  not 
simply  a  minimum  subsistence  wage,  but  approach  toward  a  pro- 
gressive, comfort  wage  i»  not  only  ethically  justified  but  econom- 
ically imperative  today.  A  further  view  that  the  successful 
company  and  industry  have  an  obligation  to  "pass  prosperity 
around,"  is  held  by  a  sufficient  number  of  employers  and  workers 
to  make  it  necessary  for  the  auditor  to  call  it  to  the  management's 
attention. 

Again,  the  auditor  is  usually  convinced  of  the  economy  of 
high  wages,  and  of  the  social  utility  of  allowing  both  workers  and 
in  Chapter  XXIV. 


THE  LABOR  AUDIT  CHECK-LIST  317 

consumers  to  share  by  one  device  or  another  in  the  prosperity 
of  the  industry  in  question.  To  the  fullest  extent  possible  he 
should  endeavor  to  have  the  management  understand  and  act 
on  this  view. 

19.  Other  Provisions  for  Employees. — Employees'  total  earn- 
ings will  be  represented  not  simply  by  the  amount  in  the  pay 
envelope,  but  by  the  supplementary  advantages,  however  provided, 
which  make  their  money  go  as  far  as  possible,  and  allow  them  to 
enjoy  those  community  provisions  which  in  a  real  sense  no  one 
individual's  money  can  buy.  For  this  reason  the  following  activi- 
ties are  considered  under  this  heading: 

A.  Accident  Compensation. — The  method  of  providing  work- 
men's compensation  in  case  of  accidents  is  an  important  item. 
In  states  where  there  are  compensation  laws,  it  will  be  necessary 
to  know  how  adequate  the  compensation  is,  how  easily  the 
employee  has  access  to  the  fund,  and  how  long  the  waiting  period 
is.     It  is  also  useful  to  know  whether  the  company  is  insured 
in  a  commercial  company,  or  whether  it  insures  itself.     The  tend- 
ency seems  to  be  for  the  self-insured  companies  to  show  a  mini- 
mum of  accidents. 

B.  Sickness   Insurance. — The    auditor    will    desire    to    know 
what  organized  provision  is  made  for  compensating  employees 
in  times  of  illness.     If  some  type  of  group  insurance  is  utilized, 
it  will  be  a  matter  of  proper  inquiry  to  find  out  whether  the 
employee  can  retain  his  insurance  after  resignation  or  discharge. 
If,  however,  provision  for  sick  employees  is  made  through  an 
employees'  benefit  society,  it  will  be  important  to  be  sure  of  the 
solvency  of  this  organization  and  of  the  degree  of  integrity  and 
efficiency  with  which  its  work  of  disbursement  is  carried  on. 

C.  Unemployment     Insurance. — Few     corporations     in     this 
country  have  yet  worked  out  a  satisfactory  plan  for  compensat- 
ing employees  in  dull  times  or  when  there  is  no  work.     This  type 
of  compensation  is,  however,  given  by  a  number  of  the  inter- 
national trade  unions.     The  item  is  included  at  this  point  in 
order  to  indicate  that  this  is  one  of  the  exigencies  for  which  the 
employer,  the  worker,  and  the  community  ought  to  provide. 

D.  Pensions.- — A   similar  responsibility  is  increasingly   being 
acknowledged    regarding  provision  for  old  employees.      Until 
the  community  as  a  whole  is  prepared  to  admit  its  responsibility 
for    caring  for  aged  workers,  there  is  a  definite  responsibility 
upon  employers,  which  is  too  frequently  not  met  in  any  organized 


318  PERSONNEL  ADMINISTRATION 

way.  It  is  important  to  understand  the  company's  policy 
regarding  aging  workers.  Are  they  discharged  when  they  are  a 
certain  maximum  age,  or  is  there  a  policy  of  giving  certain  types 
of  light  work,  or  of  pensioning  them  individually;  or  is  there 
some  more  systematic  provision? 

E.  Life  Insurance. — With  the  increasing  extension  of  group 
insurance  plans,  it  is  necessary  for  the  auditor  to  find  out  whether 
the  plan,  if  it  exists,  is  working  satisfactorily  and  fairly  to  the 
employees.     It  is  useful  to  know  whether  the  group  insurance 
is  compulsory  or  not,  whether  there  are  employees'  contributions, 
and  whether  the  insurance  policy  can  be  continued  by  the  em- 
ployee after  he  leaves  the  company. 

F.  Savings  Facilities. — The  fact  that  there  is  easy  access  to  a 
safe  depository  and  means  of  investment  is  an  advantage  to 
many  workers.     The  auditor  should  assure  himself  that  this 
provision  is  being  made  with  the  maximum  of  convenience  and 
security  to  the  worker,  and  know  that  it  affords  him  an  interest 
rate  equal  at  least  to  the  going  rates  of  the  locality.     Inasmuch 
as  the  auditor  in  all  his  activities  is  looking  for  a  chance  for  the 
educational  motive  to  be  displayed,  he  will  be  quick  to  inquire 
whether   the   encouragement   of   savings   has   been   developed 
through  an  organization  which  the  employees  control  or  help 
to  control. 

Closely  connected  with  the  question  of  saving  is  the  problem 
of  the  loan  shark.  It  is  important  that  the  company  have  some 
defined  policy  toward  the  assignment  of  wages  by  its  employees. 
Those  companies  which  have  been  interested  in  hunting  down  the 
ingenious  methods  by  which  employees'  savings  are  wiped  out, 
have  found  that  by  undertaking  an  aggressive  policy  of  making 
small  loans,  and  giving  free  legal  counsel  to  their  employees, 
they  have  almost  automatically  eliminated  the  worst  of  the  loan 
shark  evil. 

G.  Purchasing. — Especially  in  times  of  high  prices  the  saving 
to  be  effected  by  large  scale  buying  is  being  appreciated  by  many 
firms  and  by  their  employees;  and  one  or  another  type  of  com- 
pany purchasing  is  being  introduced.     Under  these  plans,  it  is 
interesting  to  know  whether  payment  is  made  in  cash  or  by  deduc- 
tion from  pay  envelopes;  also  what  part  the  employees  play  in 
the  management  of  the  purchasing  plan;  and  to  what  extent 
the  company  is  out  of  pocket  for  this  type  of  service. 

H.  Housing. — The  point  of  immediate  interest  in  discussing 


THE  LABOR  AUDIT  CHECK-LIST  319 

the  housing  situation  is,  of  course,  its  effect  upon  the  efficiency 
and  character  of  the  employees.  The  inquiry  is  not  necessarily 
into  the  community  aspects  of  the  problem,  although  it  will 
usually  be  found  that  any  serious  housing  problem,  due  to  a 
deficiency  of  houses  or  to  poor  quality  of  houses,  is  a  matter  in 
which  the  community  must  sooner  or  later  take  a  hand.  But 
the  primary  interest  of  the  auditor  is  to  make  clear  to  the  com- 
pany the  extent  to  which  there  is  a  direct  relation  between  the 
attitude  of  the  workers  and  the  local  housing  situation,  and 
the  extent  to  which  the  company  ought  to  concern  itself  about 
the  problem. 

Especially  if  there  are  company  houses,  a  number  of  important 
questions  arise,  such  as :  Are  rents  paid  by  deductions  from  pay 
envelopes,  or  cash  payments?  How  are  the  properties  adminis- 
tered and  kept  in  repair?  What  policy  does  the  company  pursue 
regarding  eviction  if  employee  tenants  strike? 

I.  Transportation. — In  the  same  way,  the  problem  of  trans- 
portation is  of  interest  to  the  auditor  to  the  extent  that  he  finds 
that  there  is  a  relation  between  the  transportation  problem  and 
the  workers'  attitude  toward  the  factory.  If,  for  example, 
the  transportation  rates  are  high,  if  the  plant  is  inaccessible, 
or  if  the  trolley  service  is  infrequent,  there  may  very  probably 
arise  complaint,  due  to  the  Increased  length  of  the  over-all 
working  day,  which  the  delays  in  transportation  create. 

J.  Public  Health. — The  same  point  of  view  is  to  be  maintained 
in  the  consideration  of  the  next  three  topics.  Is  there,  for 
example,  an  organization  of  public  health  service  locally  which 
assures  a  wholesome  and  healthy  community?  To  the  extent 
that  this  is  an  adverse  factor  the  management  should  be  ac- 
quainted with  it. 

K.  Recreational  Facilities. — It  is  becoming  axiomatic  today  that 
workers  will  not  stay  long  in  a  community  which  does  not  boast 
a  reasonable  variety  of  social  life.  This  problem  may  arise 
more  conspicuously  in  small  localities  than  elsewhere,  but  under 
any  conditions  it  is  necessary  for  the  auditor  to  satisfy  himself 
that  the  workers  have  access  to  recreation  which  is  congenial 
to  them  and  of  a  character  and  price  that  is  satisfactory. 

L.  Educational  Facilities. — As  soon  as  the  worker  has  children 
who  are  of  school  age,  the  nearness  and  efficiency  of  the  public 
schools  will  be  a  determining  factor  in  his  movements.  With  the 
more  ambitious  workers  the  night  school  facilities  which  a  com- 


320  PERSONNEL  ADMINISTRATION 

munity  provides  will  also  be  a  factor.  In  any  case  the  important 
thing  for  the  auditor  to  bear  in  mind  is  that  the  character  of  the 
public  education  system  may  have  important  bearings  upon  the 
stability  of  the  plant's  working  force. 

Mechanics  of  Presentation. — In  concluding  the  labor  audit, 
the  auditor  usually  emphasizes  the  value  which  the  company 
would  derive  from  having  a  careful  study  of  industrial  relations 
made  recurrently  at  yearly  or  half-yearly  intervals.  And  he  can 
well  point  out  that  the  form  of  report  herein  set  forth  offers 
a  convenient  method  of  recording  and  comparing  the  facts. 

As  a  further  matter  of  technique  in  presentation  the  following 
points  should  be  stressed: 

There  should  be  a  good  index  at  the  beginning  of  the  report. 
There  should  be  at  the  outset  a  concise  summary,  a  few  pages 
in  length,  indicating  the  high  lights  of  the  report  and  of  its 
recommendations . 

It  will  usually  be  simplest  to  have  recommendations  on  each 
subject  follow  immediately  after  the  section  of  the  audit  in  which 
that  subject  is  treated;  then  for  purposes  of  reference  have  the 
most  important  recommendations  brought  together  again  at  the 
end.  In  connection  with  this  summary  of  the  recommendations 
it  will  usually  be  invaluable  to  suggest  the  order  in  which  the 
auditor  believes  the  recommendations  ought  to  be  carried  out— 
the  relative  urgency  of  the  several  problems. 

Experience  shows  that  the  finished  report  will  constitute  a 
typewritten  document  anywhere  from  50  to  200  pages  long. 
It  will  inevitably  seem  to  the  management  that  this  is  a  bulky — 
perhaps  unduly  bulky — statement  of  facts  and  conditions.  For 
this  reason  it  should  be  strongly  urged  upon  the  executives  to 
whom  the  report  goes  that  it  should  at  first  be  read  as  a  whole 
and  in  so  far  as  possible  read  at  one  sitting.  It  is  extremely  im- 
portant for  the  executives  to  see  all  around  the  problem  at  once; 
and  this  end  can  be  most  readily  achieved  if  the  audit  is  read 
through  at  one  time.  The  executive  can  then  go  back  at  his 
leisure  and  study  particular  sections. 

Two  other  possible  contingencies  may  arise.  In  the  first 
place,  there  are  plants  where  two  or  three  problems  are  found 
to  be  so  outstanding  in  their  influence  that  until  they  are 
stated  and  understood  nothing  else  about  the  plant  matters. 
In  cases  of  this  sort  it  is  good  strategy  to  preface  the  audit  by  an 
analysis  of  these  major  problems,  and  then  to  follow  it  with  the 


THE  LABOR  AUDIT  CHECK-LIST  321 

usual  treatment  of  the  other  topics.  This  method  has  the  value 
of  greater  emphasis  and  directness  of  treatment  of  the  salient 
difficulties. 

In  the  second  place,  there  are  executives  who  are  poor  readers. 
They  feel  that  they  have  not  the  time,  and  therefore  they  have 
not  the  patience  to  absorb  in  detail  an  elaborate  document. 
To  be  sure  they  are  mistaken;  they  are  usually  trying  to  see  in 
unduly  simplified  terms  a  problem  which  is  inherently  the  most 
complex  of  all  the  problems  of  the  plant — the  problem  of  human 
relations.  But  such  men  have  to  be  reached  and  influenced. 
It  may  possibly  be  found  that  a  re-arrangement  of  the  nineteen 
topics  under  a  fewer  number  of  headings  with  the  omission  of 
much  detail  will  be  a  more  convenient  form  of  presentation, 
after  the  longer  draft  has  been  prepared.  The  following  re- 
arrangement of  topics  may  be  of  use  in  such  cases.  The  numerals 
in  parenthesis  after  the  topic  refer  to  the  topic  number  in  the 
audit. 

A.  Working  conditions  (Topic  1) 

B.  Work  process  and  organization  (Topics  II,  III,  IV,  XVII). 

C.  Terms  of  employment  (Topics  III,  XVIII,  XIX). 

D.  Methods  of  relations  with  employees  (Topics  V,  VI,  VII,  X,  XI, 
XII). 

E.  Points  of  view  (Topic  VIII). 

F.  Community  conditions  and  relations  (Topics  IX,  XIII,  XIV,  XV, 
XVI,  XIX). 

Another  way  of  handling  non-reading  executives  is  to  read  the 
report  to  them  and  discuss  it  in  a  series  of  conferences. 

Uses  of  the  Labor  Audit. — The  practical  uses  of  the  labor 
audit  should  be  summarily  considered  from  four  points  of  view; 
the  uses  to  the  general  management,  to  the  personnel  manager, 
to  the  workers,  and  to  the  community. 

To  the  Management. — The  audit  is  useful  to  the  management 
as  a  method  of  standard  record  and  careful  analysis.  But  the 
material  incorporated  in  its  individual  sections,  together  with 
the  recommendations,  can  also  profitably  be  made  the  topic 
for  discussion  and  for  educational  work  in  executives',  foremen's 
and  workers'  conferences.  In  a  plant  already  well  function- 
alized,  the  different  sections  of  the  report  would  naturally 
be  turned  over  for  action  to  the  executive  charged  with  the 
responsibility  for  the  function  under  consideration.  But  more 

than  this  is  necessary,    The  audit  has.  been  made  from  the  point 
21 


322  PERSONNEL  ADMINISTRATION 

i 

of  view  of  assessing  the  all-around  human  and  social  solvency  of 
the  organization  or  institution.  And  to  the  extent  that  this  all- 
around  point  of  view  can  be  imparted  to  all  members  of  the  exec- 
utive staff  by  reading  and  discussing  certain  portions  if  not  all 
of  the  audit,  to  that  extent  the  broadest  educational  purpose  will 
be  served. 

The  audit  can  also  to  a  certain  extent  give  the  management  a 
good  estimate  of  a  personnel  department's  working  efficiency.  It 
can,  in  other  words,  be  an  audit  of  the  personnel  department. 
But  it  is  more  than  simply  a  statement  of  conditions.  It  should  be 
definitely  a  working  manual,  which  in  the  hands  of  all  the  per- 
sonnel executives  can  be  used  as  suggestive  of  a  point  of  view  and 
of  new  methods. 

Where  new  executives  are  being  introduced  both  into  general 
executive  work  and  into  the  personnel  department,  it  is  conven- 
ient to  have  in  fairly  compact  compass  a  statement  that  makes 
clear  to  them  how  the  company's  labor  policy  is  operating.  If  a 
labor  audit  is  turned  over  to  such  new  executives  to  read  they 
can  be  quickly  instructed  in  the  policy  and  methods  under  which 
the  company  operates.  As  a  document  for  the  instruction  of 
new  executives  the  audit  can  have  peculiarly  significant  values. 

Again,  the  conscientious  and  enlightened  employer,  who  is 
appreciative  of  his  social  responsibility,  should  be  able  to  find 
in  the  audit  an  estimate  of  the  human  solvency  of  his  business. 
He  should  be  able  to  get  a  clear  picture  of  the  problems  which 
remain  for  the  plant  to  solve,  of  the  immediate  steps  he  should 
take  toward  their  solution,  and  of  the  larger  problems  he  should 
have  in  mind  to  work  on  over  a  period  of  years. 

The  terms  used  throughout  this  chapter  are  suggestive  of  the 
application  of  the  audit  method  to  a  factory  or  store.  But  prac- 
tically the  entire  technique  can  be  applied  also  to  an  office,  a 
city  department,  a  railroad,  mine,  hospital  or  any  other  institu- 
tion where  there  is  a  relation  of  employer  and  employed.  With 
obvious  modifications  the  labor  audit  can  be  of  great  service  to 
the  management  of  all  types  of  organizations. 

Uses  to  the  Personnel  Manager. — From  the  point  of  view  of 
the  personnel  manager,  the  labor  audit  has  certain  values  which 
are  to  be  obtained  in  no  other  way.  It  enables  him  to  know  all 
the  elements  of  his  problem.  This  knowledge  of  the  all-around 
aspects  of  the  situation  with  which  he  is  dealing  is  indispensable 
to  the  forming  of  a  right  and  adequate  policy.  It  enables  him 


THE  LABOR  AUDIT  CHECK-LIST  323 

to  frame  and  suggest  a  policy  which  is  calculated  to  meet  his 
problems  in  a  fundamental  way.  It  enables  him  to  sell  his  policy 
to  the  organization  with  maximum  effectiveness.  It  enables 
him  to  carry  on  his  own  administrative  work  with  greater  success 
because  of  his.greater  knowledge.  And  it  enables  him  to  improve 
his  policy  and  practice  because  of  the  estimate  of  its  effectiveness 
which  he  has  secured  in  the  audit. 

Another  use  of  a  different  kind  should  also  be  mentioned. 
The  personnel  manager  may,  if  he  is  casting  about  for  a  method 
of  filing  the  flood  of  pamphlets  and  clippings  on  employment  work 
which  pour  in  upon  him,  find  that  the  topical  arrangement  of  the 
audit  with  its  sub-topics  affords  a  convenient  method  of  filing. 

Uses  to  the  Workers. — The  time  has  now  come  to  meet,  and 
meet  with  emphasis,  one  possible  objection  which  may  arise  to 
the  labor  audit  from  the  workers'  point  of  view.  It  may  be  said 
that  the  audit  is  simply  a  device  to  inquire  into  the  workers' 
grievances  before  they  have  reached  substantial  proportions  and 
to  forestall  by  preventive  measures  any  vigorous  or  direct  action 
on  their  part.  It  may  be  objected,  in  other  words,  that  the 
labor  audit  is  being  used  to  maintain  the  employer  securely  and 
with  a  better  conscience  in  the  control  of  a  situation  which  may, 
from  the  broadest  point  of  view,  be  precarious  and  unsound. 
From  this  point  of  view,  the  audit  is  being  used  to  salve  the 
employer's  conscience  and  equip  him  with  methods  of  administra- 
tion which  enable  him  to  maintain  himself  more  securely  in  a 
basically  autocratic  position. 

The  answer  to  this  objection  is  clear.  The  labor  audit  is 
primarily  an  instrument  of  inquiry.  It  is  an  instrument  used  to 
discover  unscientific,  inhuman  and  socially  inexpedient  policies 
and  methods  in  the  labor  relations  of  an  organization.  In  so 
far  as  it  is  an  instrument  of  precise  analysis  it  stands  on  its  own 
feet  and  is  of  use  to  anyone  who  is  in  search  of  a  method  of  ex- 
haustive study.  The  fact  that  a  weapon  of  any  sort  is  capable  of 
dangerous  misuse  has  never  been  an  argument  against  its  use. 
Itr  has  simply  been  an  argument  for  its  use  in  the  right  hands  and 
with  the  right  purposes. 

As  a  matter  of  fact,  it  is  clear  to  us  as  a  result  of  investigative 
work  done  both  in  union  shop  plants  and  in  public  utilities,  that 
there  are  substantial  values  to  be  derived  from  the  use  of  labor 
audits  by  the  organized  workers  and  by  the  community.  We 
look  forward  to  the  time  when  the  organized  workers  will  on 


324  PERSONNEL  ADMINISTRATION 

their  own  behalf  (or  jointly  with  the  employers)  undertake  just 
such  systematic  analysis  as  is  here  recommended,  of  the  condi- 
tions and  terms  of  employment  under  which  their  members  work. 
Increasingly,  as  the  unions  see  themselves  in  need  of  accurate 
facts,  both  for  the  protection  of  the  health  of  their  members,  for 
their  instruction  and  for  the  information  of  the  public,  they 
will  see  the  need  of  a  method  of  inquiry  which  will  at  least  approxi- 
mate that  of  the  labor  audit. 

Considering  the  objection  that  the  recommendations  of  the 
audit  may  indicate  methods  of  procedure  which  will  perhaps  make 
the  workers  content  with  a  relationship  which  is  fundamentally 
inequitable — the  answer  is  that  in  the  use  or  abuse  of  this  method 
much  depends  upon  the  point  of  view  of  the  auditor.  His  rec- 
ommendations may  be  far-sighted  or  they  may  be  of  only  tem- 
porarily alleviative  value.  But  whoever  owns  the  shop  and 
whoever  controls  the  shop,  the  problem  of  maintaining  a  cordial 
relationship  between  manager  and  managed  persists.  In  the 
administration  of  that  relationship,  as  well  as  in  the  adminis- 
tration of  the  correlation  of  the  different  departments  of  the  fac- 
tory, there  is  under  any  ownership  the  necessity  for  as  scientific 
and  precise  a  method  of  organization,  practice  and  analysis  as 
can  be  devised.  The  recommendations  of  the  labor  audit  are 
to  a  considerable  extent  preoccupied  with  the  perfecting  of  the 
organization  in  these  matters.  But  if,  in  the  mind  of  the  auditor, 
the  present  relationship  of  the  capitalist  or  manager  to  the  workers 
has  in  it  inherent  elements  of  unfairness  or  injustice,  there  is  no 
reason  why  the  auditor  should  not  point  that  out  in  his  audit. 

In  short,  these  objections  to  the  use  of  the  audit,  while  they 
should  be  borne  in  mind  as  warnings,  are  not  really  serious. 
And  it  is  to  be  hoped  that  organizations  of  the  workers  and  of 
the  public,  as  well  as  managers,  will  extend  the  use  of  this 
method  of  fundamental  analysis. 

Uses  to  the  Community. — As  the  public  responsibility  for  the 
proper  conduct  of  the  public  utilities  is  more  and  more  stressed, 
and  to  the  extent  that  assertion  is  made  that  the  "  interest  of  the 
public  is  paramount,"  it  will  be  a  public  obligation  to  have  the 
facts  about  the  operation  of  the  labor  policy  of  public  utilities 
constantly  at  the  disposal  of  the  public.  Most  of  the  material 
that  a  labor  audit  contains  should  not  simply  be  a  matter  of 
public  record  where  public  service  corporations  are  involved;  it 
should  be  a  matter  for  deliberate  publicity  in  published  reports, 
newspaper  write-ups,  pamphlets,  bulletins,  etc. 


THE  LABOR  AUDIT  CHECK-LIST  325 

In  some  of  the  most  critical,  recent  strikes  in  street  railway 
transportation,  for  example,  if  the  public  had  known  accurately 
what  the  facts  were,  in  advance  of  the  interruption  of  work,  it 
would  have  brought  pressure  to  bear  on  both  sides  to  effect  a 
modification  of  policy  and  practice  which  would  have  made  a 
strike  altogether  unlikely. 

But  there  is  a  wider  field  for  the  audit's  usefulness.  It  is 
increasingly  recognized  that  state  industrial  commissions  have 
not  simply  a  regulative,  but  a  preventive  and  constructive 
function.  In  order  successfully  to  perform  that  function  for  all 
of  industry  there  is  needed  more  information  about  every  factory, 
a  more  penetrating  and  inclusive  view  of  each  factory's 
problem.  The  time  may  not  be  far  off  when  state  labor  com- 
missions and  the  U.  S.  Department  of  Labor  will  institute 
what  will  in  effect  be  bureaus  of  labor  audit  and  research. 

Results  of  the  Labor  Audit. — 'The  results  of  the  labor  audit 
hinge  largely  on  two  factors:  On  the  character,  capacity  and 
conviction  which  the  auditor  himself  carries,  and  on  the  inclina- 
tion of  the  interested  parties  to  act  upon  the  recommendations 
which  are  made.  Assuming  that  these  two  conditions  have  been 
met,  it  is  possible  to  indicate  several  tangible  and  beneficial 
results. 

In  the  first  place,  the  audit  should  increase  the  ability  of  those 
who  determine  personnel  policy  to  see  that  policy  as  a  rounded 
whole,  to  see  that  there  are  no  panaceas  in  this  field,  and  to  see 
that  a  great  variety  of  problems  must  be  attacked,  if  conditions 
are  to  be  bettered  and  more  just  relationships  established.  This 
is  an  incalculably  desirable  result  since  it  will  check  the  tendency 
of  executives  to  pursue  hobbies  and  panaceas  as  solutions. 

But  a  more  positive  function  should  be  served  in  the  laying 
out  of  a  long-time  program  and  plan  of  personnel  activities  on 
which  a  company  can  soundly  work  for  some  years  to  come. 
In  other  words,  there  results  from  the  audit  a  new  sense  of 
significance  and  direction  in  personnel  policy. 

From  the  point  of  view  of  labor  organizations  the  results  of 
the  labor  audit  will  look  in  the  direction  of  getting  both  the 
conditions  and  the  government  of  industry  upon  a  fairer  and 
more  equitable  basis.  The  immediate  result  will  be  to  inform 
organized  workers  in  a  concrete  way  as  to  the  practical  success, 
from  their  point  of  view,  of  the  existing  structure  of  government. 

It  can  finally  be  said  that  as  soon  as  the  labor  audit  is  used  as 
an  instrument  of  public  investigation  and  oversight  in  industry, 


326  PERSONNEL  ADMINISTRATION 

it  will  bring  to  light  a  vast  number  of  discrepancies  and  inadequa- 
cies in  the  administration  of  industrial  personnel  work,  which 
will  be  almost  automatically  corrected  once  the  light  of  day  is  let 
in  upon  them. 

Robert  F.  Hoxie  well  characterized  the  existing  condition 
which  the  labor  audit  is  calculated  to  correct,  when  he  said  that 
"in  labor  contests  no  foreknowledge  exists;  there  is  no  machinery 
for  getting  it,  no  enlightened  public  opinion;  there  is  arbitrary 
disregard  of  public  rights,  false  claims  and  a  helpless  public." 

"We  must,"  he  continues,  "have  means  for  developing  a  body 
of  exact  and  truthful  information,  developing  common  standards 
of  right  and  justice  (maxima  and  minima  or  rules  of  the  game), 
developing  a  real  public  opinion  back  of  them,  developing  a 
constructive  social  program,  getting  centralized,  strong,  able, 
elastic  administration  and  enforcement  of  laws,  with  a  view  to 
the  whole  situation;  getting  and  applying  knowledge  and  stand- 
ards to  control,  and  in  the  settlement  of  contests,  creating  to  this 
end  social  interactions.  This  understanding  and  knowledge 
can  be  secured  only  by  the  closest  first-hand  study  in  the  field. 
It  is  all  a  matter  of  doing  the  work  in  a  calm,  orderly,  large- 
minded  and  farsighted,  constructive  and  scientific  manner."1 

Professor  Hoxie  has  well  expressed  the  larger  function  of  the 
labor  audit.  It  is  to  supply  knowledge,  discuss  method,  and 
evaluate  personnel  policies  in  a  temper  which  is  large-minded 
and  farsighted.  It  is  to  inject  into  the  discussion  of  proposed 
constructive  policies  for  industry  a  realism  and  concreteness 
which  will  keep  everyone's  feet  planted  firmly  on  the  ground.  It 
is  to  create  a  sensitive  regard  for  practical  and  helpful  suggestions 
which  are  of  permanent  value,  because  they  are  elaborated  in 
the  light  of  a  clearly  defined  and  socially  wise  purpose  of  industrial 
growth  and  service. 

The  problem  of  control  and  of  authority  is  indeed  basic  in 
modern  industry.  But  progress  will  be  halting  and  subject  to 
violent  transitions,  unless  all  parties  to  our  economic  life  address 
themselves  in  a  public  spirit  to  the  task  of  applying  knowledge 
and  stahdards  in  the  field  of  control.  The  labor  audit's  justifica- 
tion is  the  aid  it  can  bring  in  this  discovery  of  fact  and  standard, 
and  the  dispassionate  spirit  which  it  can  help  to  cultivate  for  the 
discussion  of  sound  methods  of  government  and  administration 
in  industry. 

1  HOXIE,  R.  F.     Trade  Unionism  in  the  United  States,  pp.  374-5. 


CHAPTER  XXIII 
THE  ELEMENTS  IN  WAGE  DETERMINATION 

The  problem  of  payment  occupies  a  position  of  central  interest 
in  the  industrial  world.  "How  much  do  you  pay?"  "What 
is  a  fair  day's  wage?"  These  two  questions  are  immediately  put 
by  workers  on  the  one  side  and  employers  on  the  other.  Over 
wages,  piece  prices  and  payment  plans,  controversy  seems  endless; 
the  differences  seem  often  insurmountable. 

The  need  is  clearly  for  a  fresh  approach  to  the  problem;  for 
an  attempt  to  see  if  any  standards  exist  or  might  be  established, 
if  any  broad  principles  may  be  agreed  upon  which  tend  to  narrow 
wage  discussions  within  reasonable  limits.  And  it  is  the  purpose 
of  this  and  the  next  chapter  to  consider  the  present  attitudes 
and  standards  of  managers  and  workers  toward  payment,  and  to 
see  if  they  suggest  the  line  of  development  which  a  more  stable 
and  scientific  payment  procedure  might  take.  We  shall  not, 
however,  attempt  to  cover  ground  already  covered  by  other 
writers1  in  description  of  the  great  variety  of  premium  and  bonus 
plans.  Our  purpose  is  rather  to  see  with  what  determining 
beliefs  and  attitudes  both  sides  approach  the  problem. 

The  Employer's  Point  of  View. — Three  distinct  points  of  view 
about  payment  are  distinguishable  among  employers.  They 
may  be  characterized  as  (1)  paying  the  going  market  rate;  (2) 
paying  enough  more  than  the  market  rate  to  buy  greater  interest 
and  create  an  incentive;  (3)  paying  in  relation  to  several  factors — 
as  e.g.,  cost  of  living,  years  of  service,  profits  of  the  business. 

Undoubtedly  the  first  of  these  points  of  view  is  still  quite  preva- 
lent. This  is  the  theory  which  squares  with  the  so-called 
"fundamental  law  of  supply  and  demand"  on  which  the  older 
employers  were  brought  up.  It  implies  that  the  market  rate  is 
set  as  a  function  of  the  relation  between  the  supply  of  workers  and 
the  demand  for  them.  Labor  in  this  view  is  a  commodity,  the 

1  For  an  exposition  of  existing  wage  schemes,  see  JONES,  E.  D.,  Ad- 
ministration of  Industrial  Enterprises,  Chapters  XIII  and  XIV. 

See   also   the   Questionnaire    Digest   on    Methods   of  Wage  Payment, 
Western  Efficiency  Society,  July,  1918. 

327 


328  PERSONNEL  ADMINISTRATION 

value  of  which  rises  and  falls  with  the  availability  of  the  supply. 
Asked  what  determines  the  amount  of  wages,  the  employer  who 
holds  this  view  will  answer:  "It  depends  on  how  much  we  can 
get  workers  for.  If  there  is  a  crowd  around  the  gate  we  can  offer 
less;  if  we  need  more  workers  than  there  are  in  sight,  we  must 
offer  more."  This  notion  gives  rise  to  the  attitude  that,  "we 
pay  as  little  as  necessary  and  then  do  all  we  can  to  get  as  much 
work  as  possible.'"' 

This  frequently  met  but  surely  over-simple  analysis  of  the 
wage  problem  is  now  superseded  in  the  thinking  of  those  employ- 
ers who  make  any  claim  to  enlightened  self-interest,  by  another 
point  of  view.  The  idea  is  gaining  ground  that  not  low  wages 
but  high  wages  bring  low  costs.  It  is  desirable,  in  this  view, 
not  merely  to  buy  so  many  foot-pounds  of  a  worker's  energy,  but 
to  create  some  incentive.  Piece  rates  are  offered  with  this  idea 
in  mind ;  all  the  numerous  differential  payment  and  bonus  schemes 
work  from  this  basis;  and  many  of  the  so-called  "profit  sharing" 
plans  and  methods  of  easy  purchase  of  company  stock  have  this 
end  in  view.  If  the  worker  realizes  that  the  amount  of  wage  is 
conditioned  by  his  own  effort,  his  efforts  will  be  more  sustained 
and  the  production  greater. 

But  it  is  definitely  a  part  of  this  whole  idea  that  whereas  wages 
will  be  higher  than  under  the  market-rate  theory,  they  will  not 
by  any  means  be  high  enough  to  absorb  the  whole,  or  even  any 
large  proportion,  of  the  saving  in  costs  which  results  as  soon  as  the 
number  of  units  of  output  per  hour  or  day  is  largely  increased. 
Fundamentally,  this  point  of  view  is  closely  related  to  the  market- 
rate  theory,  since  here  also  the  effort  is  in  the  direction  of  paying 
as  little  as  necessary  (although  it  is  seen  that  more  than  the  mar- 
ket rate  is  necessary)  to  get  as  much  work  as  possible. 

In  plants  where  either  of  these  two  points  of  view  are  held,  the 
simplicity  of  the  case  may  be  destroyed  by  the  entrance  of  col- 
lective bargaining  under  which  the  workers  aim  by  their  organized 
power  to  get  a  base  rate  which  seems  to  them  more  equitable  than 
that  based  on  "supply  and  demand."  However,  to  the  extent 
that  the  employer  finds  that  the  union  scale  does  buy  a  reasonable 
interest  and  incentive,  collective  bargaining  need  in  no  way  con- 
flict with  his  purposes  or  the  security  of  his  rate  of  profit. 

There  are,  finally,  an  increasing  number  of  managements  which 
desire  to  get  a  more  "sound  "  basis  of  payment.  The  usual  tend- 
ency in  the  plans  of  these  employers  may  be  briefly  outlined  as 


329 

follows.  They  set  a  minimum  wage  in  direct  relation  to  the  cost 
of  living.  They  attempt  to  evaluate  a  number  of  elements  in 
determining  pay,  as  for  example, 

rate  of  production 

spoiled  work  or  damage  to  equipment 

years  of  continuous  service 

lateness  and  absence 

number  of  major  processes  worker  can  do 

monetary   responsibility  placed  in  hands  of  workers 

cooperation  and  conduct.1 

They  may  also  attempt  to  make  some  permanent,  regular  and 
stipulated  distribution  of  the  entire  profits  after  agreed  deductions 
for  a  limited  dividend  and  other  usual  charges. 

To  employers  in  this  group  and  in  an  inquiring  frame  of  mind 
regarding  a  sounder  system  we  suggest  that  a  careful  study  of 
both  parts  of  the  payment  plan  hereafter  discussed  will  offer 
practical  aid.  To  employers  in  the  other  two  groups,  we  suggest 
that  even  if  the  second  part  of  our  proposal  (see  next  chapter) 
seems  a  long  way  ahead,  there  are  good  business  reasons  for 
making  use  of  many  of  the  principles  set  forth  in  the  present 
chapter. 

The  Employees'  Point  of  View. — Current  facts  about  wage 
questions  also  include  the  employees'  attitude.  Here,  again,  we 
find  three  fairly  distinct  points  of  view;  and  they  parallel  in  a 
significant  way  the  various  attitudes  of  employers. 

There  is,  first,  the  "get  away  with  it"  attitude;  the  point  of 
view  that  the  worker  "will  do  as  little  as  necessary  and  get  as 
much  pay  as  possible" — the  direct  and  inevitable  response  to 
the  employer's  similar  attitude.  Although  widely  held,  this 
view  is  always  likely  to  be  modified  in  one  of  several  ways. 

There  is  in  consequence  a  second,  less  simple  view  that  if  more 
than  the  market  rate  can  be  obtained,  more  work  will  be  done. 
Normally  the  worker  whose  vitality  is  not  impaired  and  whose 
education  in  subservience  has  not  been  too  complete,  will  want 
to  earn  as  much  as  possible  and  will,  therefore,  respond  to  finan- 
cial incentives.  Again,  he  desires  promotion  and  he  realizes  that 
this  only  comes  as  he  makes  a  good  showing  at  his  present  job. 
Finally,  the  instinctive  desire  to  contrive — the  instinct  of  work- 

1  BABCOCK,  GEORGE  D.,  The  Taylor  System  in  Franklin  Management, 
pp.  79-108. 


330  PERSONNEL  ADMINISTRATION 

manship  —  is  not  wholly  dormant,  and  it  demands  some  expression 
through  the  outlet  of  "doing  a  good  job." 

But  this  second,  more  complex  motivation  is  likely  to  be  further 
complicated  by  certain  reservations,  which  at  least  the  more  intel- 
ligent workers  can  be  counted  on  to  make.  First,  they  realize 
that  under  most  of  the  bonus  schemes  the  company  not  only  gets 
much  greater  output  but  it  gets  it  at  a  progressively  less  cost  per 
unit,  the  bonuses  rarely  absorbing  as  much  as  50  per  cent,  of  the 
saving  in  costs  when  production  is  increased. 

They  find  also  that  bonuses  are  usually  offered  for  individual 
or  gang  effort  under  a  regime  of  individual  bargaining  with  the 
consequent  danger  that  if  certain  individuals  do  "too  much," 
the  rate  will  be  cut  and  the  less  skilled  workers  be  forced  out  of 
a  job  or  over-speeded.  And  rather  than  be  bribed,  even  at  con- 
siderable immediate  personal  gain,  to  continue  the  individual 
bargaining  basis,  workers  frequently  prefer  to  see  a  moderate 
level  of  rates  assured  for  all  under  a  collective  agreement. 

Again,  where  the  incentive  is  in  terms  of  profit  sharing  or 
stock  participation,  workers  tend  always  to  be  suspicious  unless 
the  basis  of  the  plan  is  clearly  understood  by  them;  unless  it  is 
in  the  form  of  a  definite,  binding  commitment  in  advance  by  the 
company;  and  unless  they  have  some  share  in  its  administration. 

There  is,  in  the  third  place,  an  attitude  rarely  met  among 
workers  because  the  conditions  are  seldom  such  as  to  bring  it  into 
prominence  —  the  attitude  that  the  worker  wants  the  real  human 
satisfactions  out  of  his  job.  This  means  that  the  job  is  to  give 
as  large  a  return  in  cash  as  possible;  that  the  conditions  surround- 
j~  ~^/  ing  the  work  are  to  be  made  right;  that  the  job  itself  is  to  offer 
a  genuine  medium  of  expression  for  the  individual's  talents  and 
desires.  This  attitude  is  indeed  rare  today;  but  it  is  not  too  much 
to  say  that  something  very  nearly  approaching  it  is  the  necessary 
condition  of  a  sound  and  productive  industrial  system.  If  it  is 
an  "ideal"  attitude  for  workers  to  have,  it  is  an  ideal  worth 
sUulying  to  make  real. 

Basis  for  Common  Action.  —  The  foregoing  rosum6  indicates 
a  clash  in  points  of  view  which  is  acute  today.  There  is  felt 
to  be  a  divergence  of  interest  regarding  payment;  and  there  is 
all  too  little  chance  to  discuss  that  divergence  and  secure  a  com- 
mon basis  of  understanding  and  action.  In  consequence  we 
find  ill-will,  suspicion  and  distrust  on  both  sides;  and  a  disposi- 
tion to  regard  any  agreeable  adjustment  of  the  problem  as 
impossible. 


/ 


sUu 
""""TO. 


THE  ELEMENTS  IN  WAGE  DETERMINATION  331 

It  seems  to  us,  therefore,  that  if  some  common  basis  in  knowl- 
edge can  be  reached,  if  some  common  meeting  ground  for  dis- 
cussion can  be  obtained,  if  some  decision  can  be  reached  on 
agreed  principles  of  wage  determination,  and  if  some  temporary 
adjustments  are  possible  on  a  basis  of  an  application  of  the 
principles  to  the  agreed  facts — then,  and  only  then,  can  managers 
hope  for  some  relief  from  arbitrary  conflict  and  perpetual  bicker- 
ing. These  four  points  deserve,  therefore,  careful  examination. 
Can  there  be  common  knowledge  about  payment,  a  common 
meeting,  certain  common  principles,  and  agreement  on  actual 
adjustments?  We  shall  next  consider  the  place  of  facts  in  the 
payment  problem. 

The  Fact  Element  in  Payment. — There  is  a  growing  disposition 
to  give  attention  to  more  than  one  or  two  factors  in  determining 
pay.  At  any  one  job  it  will  be  necessary  to  make  a  selection 
of  the  factors  which  it  is  agreed  shall  have  weight  in  reaching 
decisions  about  the  pay.  We  have,  therefore,  in  the  following 
list  included  a  large  number  of  items  from  which  such  a  dis- 
criminating selection  can  be  made  as  the  character  of  the  job 
warrants.  We  do  not  say  that  all  these  items  necessarily  require 
statement  in  relation  to  every  job. 

First  in  importance  stands  the  cost  of  living.  More  and  more, 
companies  are  realizing  that  wages  which  at  least  equal  the  cost 
of  living  are  a  necessary  charge  upon  the  business.  They  realize 
that  if  machine  maintenance  is  important,  the  adequate  main- 
tenance of  the  really  active  and  sentient  factor  in  production 
is  doubly  necessary.  It  would  seem  hardly  a  matter  for  dispute 
that  if  people  are  needed  at  all  for  manufacturing  work,  they 
must  be  paid  enough  to  preserve  health,  vigor  and  strength — 
to  maintain  their  productive  power.  The  only  reason  why 
this  has  not  become  a  truism  is  that  this  country  has  been  able 
to  rely  upon  a  constant  inflow  of  foreign  workers  who  either  were 
able  to  get  along  on  low  wages  because  of  a  simple  standard 
of  living  or  who  did  not  stay  long  enough  on  a  job  to  feel  to  the 
full  its  ill  effects.  Now  that  this  inflow  is  restricted  and  the 
idea  of  extending  the  American  standard  of  living  to  all  workers 
is  spreading,  the  use  of  the  cost  of  living  standard  to  help 
determine  minimum  rates  of  pay  will  inevitably  spread. 

Amount  of  output  is  a  factor  in  determining  pay.  We  have 
already  elaborated  our  ideas  about  the  study  and  joint  deter- 
mination of  different  grades  of  competence  at  a  job.1  These 

1  See  Chapter  XIX. 


332  PERSONNEL  ADMINISTRATION 

grades  should  be  fixed  by  a  correlation  of  several  factors  of  which 
the  quantity  of  output  is  the  first. 

Quality  of  output  is  the  second  factor.  At  those  jobs  where 
quality  is  definitely  determinablc,  there  is  every  reason  why 
it  should  figure  in  determining  a  worker's  pay. 

Material  cost  is  the  third  item  to  be  correlated  in  fixing  of  a 
worker's  grade  of  competence.  We  include  under  this  term 
several  elements,  some  or  all  of  which  may  be  measurable  at 
any  one  job;  for  example,  amount  of  power  consumed,  cost  of 
machine  maintenance,  amount  of  oil  used,  amount  of  waste, 
spoilage  of  work  or  equipment. 

Time  factors  would  be  the  other  element  in  making  up 
a  worker's  grade.  Regularity  of  attendance  and  lateness  would 
be  especially  considered  here. 

Prctnous  education  necessary  will  vary  with  the  job;  and  it  is 
naturally  true  (if  there  is  to  be  any  pay  differential  at  all)  that  the 
job  for  which  one  can  qualify  with  no  schooling  will  pay  less  than 
the  one  requiring  a  grammar  or  high  school  education. 

The  amount  of  job  instruction  necessary  also  helps  to  gauge  the 
degree  of  skill  required.  The  trade  which  it  takes  four  years  to 
master  is  normally  going  to  command  more  than  the  job  which 
is  learned  in  two  weeks. 

Length  of  service  is  in  some  occupations  made  an  important 
determining  factor.  This  is  especially  true  at  work  where  the 
obvious  technique  is  easily  learned  but  where  the  worker's 
value  increases  with  the  years  because  of  his  reliability,  more 
perfect  command  of  the  job  and  the  more  complete  confidence 
which  it  is  possible  to  repose  in  him. 

Hazards  of  the  job  sometimes  affect  the  pay  favorably  to  the 
workers;  sometimes  they  do  not.  It  certainly  seems,  however, 
to  l>e  a  plausible  conclusion  that  when  there  is  an  increased  risk 
of  sickness,  accident  or  even  death  constantly  present,  the  neces- 
sity for  the  worker's  making  exceptional  insurance  provisions 
justifies  high  pay.  Moreover,  as  workers  come  to  discriminate, 
it  will  t>e  necessary  to  pay  a  differential  to  induce  them  to  engage 
on  more  hazardous  jobs. 

The  disagreeable  character  of  ivork  will  tend  to  play  a  larger  and 
larger  part  in  determining  pay.  It  is  one  of  the  anomalies  of  an 
over-supplied  labor  market  that  those  who  do  the  most  dis- 
agreeable work  receive  the  least  pay.  But  as  the  supply  of 
illiterate  labor  is  reduced,  there  will  necessarily  be  placed  a 


THE  ELEMENTS  IN  WAGE  DETERMINATION          333 

premium  upon  that  work  which  is  carried  on  under  unpleasant 
conditions. 

Possibilities  of  advancement  in  some  cases  affect  the  amount  of 
pay.  Where  these  possibilities  are  good,  that  often  has  the  effect 
of  keeping  down  the  rates  at  the  lower  grade  job,  as  the  increase 
in  pay  comes  with  promotion  to  the  higher  job. 

Wages  in  the  community  will  usually  be  an  influential  factor. 
Especially  will  it  be  useful  to  know  the  rates  paid  at  jobs  of  a 
character  comparable  with  those  under  consideration.  This 
information  will,  however,  be  of  greater  interest  in  relation  to 
minimum  rates  than  to  any  other. 

Wages  in  the  industry  afford  even  more  significant  data  than  do 
those  in  the  locality.  Similarly  here  they  will  be  primarily 
of  interest  in  relation  to  the  setting  of  minimum  rates.  The  wage 
figures  of  competitors  are  at  best  misleading,  however,  since  what 
is  really  significant  is  the  amount  of  product  per  dollar  of  pay  roll, 
and  the  amount  of  workers'  yearly  incomes  rather  than  their 
hourly  rates.  Wages  are  only  loosely  comparable;  unit  costs 
if  compiled  by  different  shops  in  identical  ways  give  a  more 
accurate  basis  for  comparative  study. 

The  extent  of  demand  for  the  product  will  in  the  long  run  exer- 
cise great  weight  over  pay.  An  industry  with  a  falling  market 
is  never  in  the  same  position  regarding  wages  as  is  an  industry 
with  a  rising  market.  And  what  is  thus  obviously  true  in  these 
extreme  cases,  is  still  true  where  the  changes  in  demand  are  not 
so  quickly  demonstrable  nor  so  rapidly  felt. 

The  amount  of  profits  of  the  business  is  already  admitted  to  be  a 
factor  in  determining  pay  in  many  cases.  Where  wage  rates 
are  on  a  sliding  scale  fixed  with  relation  to  prices;  wherever  in 
addition  to  wages  an  annual  bonus  is  given  based  on  a  per  cent, 
of  wages  paid  out  of  profits ;  wherever  monopoly  conditions  have 
given  rise  to  large  profits  and  higher  than  current  rates  are  paid; 
it  is  roughly  true  that  in  all  these  cases  the  amount  of  profit  is 
a  factor  in  the  determination  of  wages.  And  it  is  certainly  fur- 
ther true  that  the  company  which  is  known  to  be  profitable  is 
more  likely  than  the  less  prosperous  one  to  be  besieged  with 
demands  for  larger  pay  (with  the  exception  that  the  more  pros- 
perous company  may  resort  to  repressive  practices  which  keep 
"agitation"  at  a  minimum). 

Ultimately,  methods  of  financing  the  company  will  have  an 
effect  on  the  payment  situation.  Policy  as  to  the  amount  of 


334  PERSONNEL  ADMINISTRATION 

outstanding  stock  in  relation  to  physical  valuation,  as  to  amounts 
at  which  patents,  trade  marks  and  goodwill  are  capitalized, 
amounts  set  aside  for  depreciation,  for  reserves,  for  surplus  and 
extensions,  will  influence  the  finances  of  a  corporation  appre- 
ciably; and  the  eventual  connection  between  decisions  on  all 
these  matters  and  wage  determination  can  become  very  close. 

Finally,  the  policy  regarding  the  relation  between  wages  and 
salaries  will  be  a  factor.  If  the  company  has  an  established 
procedure  regarding  minimum  wages,  that  sets  one  definite 
bottom  limit  to  pay.  If,  also,  it  has  a  scheme  of  salary  maxi- 
mum in  each  classification  and  of  a  specified  range  of  salaries  in 
each  grade  of  executive  position,  that  further  defines  financial 
obligations  and  the  charges  to  be  met. 

Sources  of  the  Facts. — Before  discussing  who  is  to  secuie  all 
these  facts  and  how  they  are  to  be  used,  we  shall  indicate  briefly 
where  they  are  to  be  found. 

Data  regarding  cost  of  living  is  available  in  the  monthly  reports 
of  the  United  States  Department  of  Labor,  which  give  figures 
at  monthly  intervals  for  typical,  selected  cities  throughout  the 
country,  showing  fluctuations  in  terms  of  a  theoretical  family 
budget,  retail  prices  of  selected  commodities  and  selected  whole- 
sale prices.1  These  figures  may  be  checked  against  those  of  the 
Times  Annalist  index  figures,  the  Dunn  and  Bradstreet  index 
figures,  and  other  occasional  studies  of  a  public  or  private  char- 
acter, important  among  which  should  be  mentioned  the  findings 
of  minimum  wage  boards  as  to  costs  of  living  for  single  adult 
women. 

Data  regarding  amounts  of  output,  quality  of  output,  mate- 
rial costs,  time  factors,  previous  education  necessary,  amount  of 
job  instruction  necessary,  hazards  of  the  job,  disagreeable  char- 
acter of  the  work,  and  possibilities  of  advancement,  will  all  be 
provided  in  the  job  analysis  of  each  job.  And  production  and 
employment  records  would  naturally  be  available  to  supplement 
the  analysis. 

Data  concerning  wages  in  the  community,  wages  in  the  industry 
and  the  amount  of  demand,  involve  wider  industrial  contacts; 
but  much  of  this  material  can  usually  be  secured  through  cham- 
bers of  commerce,  boards  of  trade,  and  the  national  trade  asso- 
ciation  of  the  industry. 

1  See  numbers  of  The  Monthly  Labor  Review  of  the  United  States 
Bureau  of  Labor  Statistics. 


THE  ELEMENTS  IN  WAGE  DETERMINATION  335 

The  rest  of  the  data — profits  of  the  business,  financial  policies 
and  provisions,  and  salary  policies  and  provisions — is,  of  course, 
usually  considered  today  to  be  the  special  private  property  of 
those  in  ultimate  control.  It  is  usually  all  available,  however; 
and  where — as  in  the  case  of  corporation  tax  returns,  excess 
profits  tax  returns,  and  Federal  Trade  Commission  investiga- 
tions— the  public  demands  this  data,  it  is  produced.  Indeed, 
we  have  come  to  regard  as  essential  the  compilation  of  this  data 
for  public  use  from  public  utility  corporations.  And  many 
firms,  once  started  on  the  road  of  profit  sharing  or  employee 
representation  in  management,  find  it  not  only  expedient  to 
make  this  information  available  to  manual  workers,  but  a  neces- 
sary condition  of  the  success  of  their  plan. 

Securing  the  Facts. — The  next  question  therefore  is:  Who 
is  to  compile  the  facts  and  how  are  they  to  be  used? 

In  discussing  the  making  of  job  analysis  we  cited  several  rea- 
sons for  having  employees  participate  in  this  work.  Briefly 
they  were  that 

Employees  have  certain  facts  about  the  job  which  no  one  else  has. 

Employees  will  agree  to  findings  and  adopt  them,  only  as  they  take  a  hand 
initially  in  formulating  them. 

Employees  will  feel  that  their  interests  are  adequately  protected  only  as 
they  have  representation  in  the  deciding  of  process  problems. 

Employees  know  that  all  elements  in  the  analysis  are  not  matters  for 
objective  measurement;  that  on  matters  of  opinion  or  desire,  their  opinion 
and  their  desire  are  as  important  as  anybody's. 

And  when  now  we  come  to  ask  who  is  to  decide  the  wage 
amounts,  we  are  forced  to  ask  ourselves  whether  the  sarr<£  argu- 
ments which  point  toward  joint  job  determination,  do  not  point  with 
equal  force  toward  joint  pay  determination.  Each  of  these  four 
arguments  for  joint  action  on  work  should,  we  believe,  be  con- 
sidered in  relation  to  pay. 

In  relation  to  the  cost  of  living,  for  example,  employees  know 
from  experience  how  much  they  have  to  spend  per  week.  They, 
and  they  alone,  are  really  in  a  position  to  tell  how  closely  the 
available  cost  of  living  figures  apply  to  their  local  situation. 
The  company's  compilations  on  this  subject  may  be  as  "scientific  " 
as  you  please ;  but  if,  with  existing  standards  of  living  and  habits 
of  consumption,  local  employees  can  demonstrate  that  wages 
are  inadequate,  their  claims  must  be  recognized. 

It  may  possibly  be  true  that  there  is  something  wrong  with 


336  PERSONNEL  ADMINISTRATION 

their  existing  standards  of  living  or  habits  of  consumption — but 
that  is  another  question.  We  take  it  that  if  the  employer  has 
any  duty  toward  his  employees  in  educating  them  to  improved 
standards  of  consumption,  the  method  of  that  education  would 
certainly  not  be  by  a  curtailment  of  amounts  in  the  pay  envel- 
ope. People  learn  to  consume  by  consuming;  and  a  certain 
amount  of  what  might  from  one  point  of  view  be  characterized 
as  "foolish  expenditure"  is  a  necessary  part  of  every  individual's 
self-education  in  consumption.  So  true  is  this  that  a  wage  at 
the  "comfort  minimum"  ought  definitely  to  include  an  item  to 
allow  for  outlays  made  in  the  interest  of  educating  the  individ- 
ual's taste  and  judgment. 

It  is  further  true  that  only  the  workers  themselves  can  speak 
for  themselves,  not  merely  as  to  what  they  need,  but  as  to  what 
they  want.  What  they  want  may  seem  unreasonable — under 
certain  conditions  it  may  even  be  unreasonable;  but  the  air  is 
kept  clearer,  action  takes  place  in  closer  relation  to  knowledge, 
if  what  the  workers  want  is  openly  known  and  jointly  considered. 

It  is,  turning  to  the  second  argument,  preeminently  true  of 
wages  that  in  the  long  run  workers  acquiesce  in  a  wage  scale 
only  when  they  have  had  a  hand  in  framing  it,  or  in  proposing  it. 
However  passive  their  acceptance  of  rates  may  seem  to  l>e,  it  is 
usually  true  that  rates  have  been  set  in  relation  to  what  some 
official  thought  the  workers  would  accept.  This  guess  may  l>e 
right;  but  it  is  less  and  less  likely  to  be  right  as  time  goes  on.  To 
rely  upon  such  a  guess,  therefore,  would  seem  to  be  a  most 
precarious  way  to  fix  wages;  especially  when  the  sensible  alter- 
native of  talking  it  over  stands  so  readily  at  hand. 

In  the  third  place,  the  idea  of  representation  of  interests  is 
gaining  such  rapid  headway  in  industrial  organization,  that  it  is 
not  unwise  nor  sui prising  to  see  it  applied  to  the  critical 
matter  of  wages.  The  protection  which  employees  want  in 
payment  matters,  they  themselves  are  alone  competent  to  secure. 
If  the  management  wants  to  cut  costs,  the  likelihood  is  that  it 
will  start  with  the  reduction  of  labor  costs.  If  it  wants  to  cut 
production,  the  likelihood  is  that  it  will  cut  the  pay  roll.  If 
the  workers  have  any  voice  at  all,  it  is  easier  for  them  to  fore- 
stall resort  to  those  two  paths  of  least  resistance.  And  this,  we 
seriously  urge,  is  really  a  good  thing  for  the  management.  It 
is  thus  checked  from  a  course  of  action  which  is  almost  always 
short-sighted,  and  is  turned  to  other  measures  of  economy  which 
are  usually  more  effective  because  more  fundamental. 


THE  ELEMENTS  IN  WAGE  DETERMINATION  337 

It  is,  finally,  truer  even  of  pay  than  of  work,  that  the  element 
of  opinion  and  desire  is  important.  The  discussion  of  pay  can 
profitably  be  narrowed  by  a  knowledge  of  the  facts  so  as  to  be 
carried  on  in  relation  to  the  possibilities,  reasonableness  and  ex- 
pediencies of  the  situation;  but  within  those  limits  the  determin- 
ing considerations  are  not  facts  but  relative  persuasiveness  and 
bargaining  power. 

So  long  as  preponderance  in  bargaining  power  remains  with  the 
management,  as  it  does  under  individual  bargaining,  wages  can 
be  arbitrarily  set  and  many  of  the  factors  above  discussed  ig- 
nored altogether.  But  surely  the  situations  in  which  such  ar- 
bitrary action  can  safely  take  place  are  fewer  today  than  ever; 
and  they  will  be  fewer  tomorrow  than  today.  In  short,  it  is 
shortsighted  business  policy  to  reckon  without  the  desires  and  aspi- 
rations of  the  employees.  Perhaps  the  employer  who  thinks  he 
"can  make  his  pile  in  ten  years  and  then  retire,"  can  afford  to  be 
thus  shortsighted.  But  certainly  no  other  employer  can. 

Possible  Objections  to  Joint  Determination. — But  there  are  cer- 
tain objections  to  making  payment  a  matter  for  joint  determina- 
tion. The  chief  one  is  the  fear  that  employees  will  so  raise  wages 
as  eventually  to  bankrupt  the  concern.  There  is  but  one  answer 
to  this.  Wherever  employees,  either  in  shop  committees  or  under 
collective  bargains,  have  conferred  with  management  on  wages, 
there  has  been  little  evidence  of  a  desire  to  be  extortionate.  The 
workers  in  a  given  situation  are  usually  among  the  first  to  under- 
stand that  the  terms  of  employment  must  be  such  as  to  allow 
the  firm  to  remain  in  business  and  hold  them  securely  in  their  jobs. 
Indeed,  only  by  joint  conference  can  employees  learn  those  facts 
which  they  must  have  if  they  are  to  agree  to  intelligent  decisions 
about  payment. 

Another  objection  is  that  such  conferences  and  "haggling" 
take  time.  This  is  true.  So  do  strikes  and  lockouts  take  time 
and  money,  and  generate  ill-will.  Happily  the  time  spent  in 
adjusting  pay  questions  is  time  from  which  educational  values 
may  be  derived  by  both  sides.  Conference  that  is  to  the  point, 
as  well  as  frank  and  exhaustive  in  analysis  and  agreement  upon 
facts,  is  always  educational.  It  indicates  to  the  workers  the  good- 
will of  the  management;  it  shows  to  the  management  the  point 
of  view  and  desires  of  the  workers.  And  such  personal  knowledge 
by  each  side  of  those  on  the  other  is  an  indispensable  condition  of 
cordial  working  relations,  Some  concerns  believe  that  personal 
22 


338  PERSONNEL  ADMINISTRATION 

contact  can  be  secured  through  parties,  picnics,  social  and  ath- 
letic events  which  the  executives  attend.  These  may  be  of  some 
supplementary  value.  But  the  personal  contacts  which  are 
truly  valuable  are  those  involved  in  furthering  the  work  of  pro- 
duction. For  these  contacts  are  more  likely  to  be  natural, 
necessary  and  spontaneous. 

The  time  spent  in  conference  in  individual  plants  is  reduced  to 
a  minimum,  however,  wherever  a  district-wide  collective  bargain 
exists.  Indeed,  where  such  bargaining  prevails  on  a  district 
scale,  we  favor  the  application  of  these  same  principles  of  joint 
job  analysis  plus  joint  pay  determination  based  on  that  analysis,  to 
the  district  under  the  direction  of  a  representative  district  board  or 
conference.1  In  these  cases  the  work  of  pay  adjustment  in  each 
shop  is  reduced  to  an  interpretation  of  the  application  of  the  agreed 
rates  to  the  individual  operation,  to  consideration  of  the  possible 
local  variations  in  job  content,  to  consideration  of  piece  prices 
where  a  piece  work  system  prevails,  etc. 

Conferring  on  the  Facts. — We  find,  therefore,  sound  business 
reasons  for  advocating  the  determination  of  pay  by  the  method 
of  conference  with  those  at  the  job.  We  shall  next  consider  what 
shop  organization  is  required  for  wage  conference;  and  see  if  it 
does  not  parallel  that  already  suggested  for  job  analysis  confer- 
ence. The  affected  interests  which  should  have  a  voice  on  wage 
problems  when  consideration  of  those  problems  takes  place 
wholly  within  the  shop,2  are: 

(a)  A  representative  of  the  financial  management. 

(6)   A  representative  of  the  personnel  management. 

(c)  A  representative  of  the  head  of  the  department  involved. 

(d)  One  or  more  representatives  of  the  workers  at  the  job. 

(e)  A  representative  of  the  employees  as  a  whole. 

Each  of  these  groups  clearly  has  a  place  in  any  conference  which 
is  to  settle  or  recommend  wage  rates,  since  each  brings  to  the 

1  Much  is  already  done  in  this  direction  under  the  protocols  and  collective 
bargains  in  the  garment  trades  throughout  the  country.  Usually  there  is 
in  each  shop,  n  shop  committee  or  a  price  committee  to  confer  with  the 
management  on  the  local  application  of  the  terms  of  the  agreement. 

1  Our  application  of  this  idea  under  collective  bargaining  conditions  will 
be  subsequently  referred  to.  Our  assumption  that  jobs  and  wages  are  being 
defined  on  the  basis  of  the  individual  shop,  by  no  means  indicates  that  we 
think  this  to  be  the  most  desirable  method.  It  happens  to  be  a  widely 
prevalent  method  and  we,  therefore,  here  consider  it  at  length  despite  its. 
obvious  limitations. 


THE  ELEMENTS  IN  WAGE  DETERMINATION  339 

settlement  of  the  problem  a  necessary  judgment  and  consent. 
In  determining  the  wage  rate  for  a  job,  the  workers  at  that  job 
would  choose  representatives  from  their  number  and  the  job 
delegates  would  in  most  cases  need  to  be  the  only  members  to 
change,  as  the  committee  deliberates  on  one  job  after  another. 

When  this  Wage  Rate  Committee  starts  to  work,  there  has 
presumably  already  been  prior  agreement  in  the  joint  job  analy- 
sis committee  as  to  the  number  of  "grades"  to  be  recognized  and 
differentiated  in  pay.  There  has,  also,  been  either  a  definite 
agreement  as  to  what  factors  are  to  have  weight  in  deciding 
pay;  or  a  tacit  understanding  (in  which  the  really  fundamental 
issues  are  ignored)  that  only  the  usual  and  obvious  factors  (such 
as  prevailing  market  rates)  shall  have  weight. 

The  company  which  for  any  reason  is  not  prepared  to  attack 
the  payment  question  fundamentally,  will  nevertheless  do  well 
to  confer  in  committee  on  wage  rates;  only  it  does  not  by  this 
act  alone  lay  all  its  cards  on  the  table.  And  we  admit  that  there 
are  plants  where  it  may  be  a  long  time  before  employees  would 
ask  them  to. 

But  in  a  company  which  wants  to  approximate  a  "sound" 
procedure  on  payment,  there  should  be  a  selection  in  conference 
of  certain  of  the  relevant  factors  enumerated  earlier  in  the  chapter, 
and  a  clear,  common  understanding  of  effective  fiscal  policies. 

There  is  a  further  body  of  facts,  not  yet  mentioned,  which  the 
wage  rate  committee  will  also  be  mindful  of.  We  refer  to  what 
we  shall  speak  of  as  job  ratios;  or  statements  in  attempt  to  fix  the 
relative  skill  required,  difficulty,  disagreeableness,  hazard,  etc., 
of  different  jobs.  Such  a  comparative  estimate  is  only  possible 
with  the  facts  at  hand  about  all  jobs  in  a  plant  or  trade.  And  it 
will  be  well  for  the  committee  on  job  analysis  in  turning  over  its 
extensive  data  on  all  the  jobs,  to  accompany  it  with  recommenda- 
tions as  to  job  ratios.  On  a  basis  of  these  recommendations, 
plus  its  own  judgment  in  the  matter,  the  wage  committee  can 
then  proceed  to  set  the  rates. 

We  are  advocating  a  separation  of  decisions  about  work  from 
decisions  about  pay — even  though,  as  is  possible,  the  two  commit- 
tees are  composed  of  practically  the  same  personnel.  A  dif- 
ference in  function  is  recognized;  and  this  difference  is  destined 
to  give  rise  in  time  to  a  much  more  healthy  attitude  toward 
work  than  now  prevails.  If  we  can  get  work  honestly  con- 
sidered by  itself  first,  and  then  pay  considered  in  relation  to  it, 


340  PERSONNEL  ADMINISTRATION 

there  will  be  an  incalculable  gain.  The  tendency  to  soldier  on 
the  job  when  only  pay  is  defined,  can  under  the  right  conditions 
give  way  to  a  condition  where  both  sides,  knowing  quite  accu- 
rately how  much  work  can  safely  be  done  from  every  point  of 
view,  agree  in  advance  on  the  pay  which  is  fair  for  that  amount 
of  work. 

We  are,  moreover,  where  several  grades  of  competency  at  a 
single  job  are  adopted,  adding  a  legitimate  financial  incentive  to 
the  various  equally  legitimate,  non-financial  incentives  already 
considered  in  Chapter  XV.  But  we  are  adding  them  in  a  way 
which  protects  the  basic  interests  of  both  sides  at  every  point. 
The  danger  of  rate-cutting,  of  overspeeding  and  strain,  is  largely 
removed  where  conference  on  work  amounts  exists.  And  the 
one  serious  danger  which  remains  must  be  frankly  faced  and 
shouldered  by  both  sides  together — the  danger  of  unemployment, 
due  to  increased  output  per  worker  or  as  a  consequence  of 
changes  in  production  process.  There  is  no  use  ignoring  this 
contingency.  As  long  as  the  man  who  is  thrown  out  of  work  by 
any  such  cause  is  in  danger  of  having  to  walk  the  streets  looking 
for  employment,  the  individual  worker  and  the  organized  workers 
have  a  real  grievance  against  the  industry  and  against  society. 
Some  adequate  and  honorable  method  of  compensating  any  thus 
involuntarily  made  idle,  is  a  necessary  condition  of  a  humane 
industrial  system. 

We  return  now  to  the  conference  on  wages  at  a  specific  job. 
If  we  assume  that  the  agreement  on  grades  involves  only  the 
journeyman's  and  apprentice's  rates  at  a  given  job,  the  task  of 
u^rccing  on  the  two  rates  is  fairly  simple.  If  there  are  to  be  four 
grades,  the  task  of  the  wage  committee  is  (assuming  the  condi- 
tions used  in  the  illustration  in  Chapter  XIX)  to  fix  weekly  wage 
rates  for  Grades  A,  B,  C,  and  Dl.  This  fixation  will,  as  we  have 
already  said,  take  place  in  relation  to  an  agreed  number  of  factors 
including  the  job  ratios.  The  smallest  number  of  factors  which 
it  would  seem  to  us  could  ever  be  used  with  safety,  we  embody 
below  in  a  summary  statement  of  principles  of  wage  determina- 
tion. And  any  company,  we  are  convinced,  can  profitably  apply 
this  body  of  principles  as  soon  as  it  cares  tot 

The  company  which  desires  to  proceed  to  greater  lengths  in 

1  A  "grade"  as  discussed  in  Chapter  XIX,  is  a  standard  of  working  pro- 
ficiency at  a  job  jointly  determined  upon  in  terms  of  quantity,  quality, 
etc. 


THE  ELEMENTS  IN  WAGE  DETERMINATION  341 

solving  the  payment  problem  can  then  follow  not  alone  the 
principles  set  forth  in  this  chapter  but  also  those  considered  in 
the  next. 

Certain  Principles  to  Govern  Wage  Determinations. — The 
pay  for  the  lowest  grade  at  any  job  (e.g.,  Grade  C  or  D  in  our 
illustration)  should  be  set  at  a  comfort-minimum  standard  of 
living. 

The  pay  for  all  jobs  and  all  grades  should  be  decided  by  con- 
ference in  which  the  workers  are  represented  equally  with  the 
management. 

The  pay  should  be  based  on  the  cost  of  living;  on  the  quantity 
of  work  done;  its  quality  where  possible  and  other  variable 
costs  over  which  the  worker  has  control. 

The  pay  should  at  least  equal  that  paid  for  work  requiring 
comparable  skill  in  the  same  locality;  and  it  should  at  least  equal 
the  pay  at  similar  work  elsewhere  in  the  same  industry. 

The  pay  for  the  adult  man  should  be  fixed  on  the  assumption 
of  his  having  to  support  a  wife  and  three  children  under  twelve 
(statistically  considered  to  be  "the  average  family").  The 
problem  of  women's  wages  we  consider  separately  at  the  end  of 
the  chapter. 

The  management  should  aim  more  and  more  to  inform  the 
workers  of  the  financial  policies  of  the  company.  The  time 
will  come  in  a  period  of  depression  or  of  a  dull  market  when 
employees'  confidence  in  facts  about  the  relation  of  finances  to 
production  may  be  eagerly  sought  in  vain,  if  it  has  not  been  sought 
when  times  are  better. 

Definition  of  a  Fair  Wage. — We  draw  from  these  principles 
and  from  our  study  of  the  payment  problem  a  definition  of  a 
fair  wage  which  we  hope  will  have  clarifying  value.  The  defini- 
tion makes  no  attempt  to  do  the  impossible.  We  see  no  possi- 
bility of  such  a  thing  as  an  "absolutely  fair  wage."  Indeed  the 
beginning  of  wisdom  regarding  the  payment  problem  is  to  realize 
that  there  are  no  absolutes  to  fall  back  upon.  "A  fair  day's  pay," 
"  a  j ust  wage, "  "  equitable  distribution" — these  are  all  relative  terms. 
They  always  have  been;  they  always  must  be.  They  mean  one 
thing  to  one  group;  something  else  to  another  group.  They 
mean  one  thing  today  and  another  tomorrow. 

Once  managers  realize  that  there  are  no  absolutes  in  the  solu- 
tion of  the  payment  problem,  three-fourths  of  the  uneasiness  and 
petulance  about  wage  adjustments  will  automatically  disappear; 


342  PERSONNEL  ADMINISTRATION 

for  it  will  be  realized  that  each  wage  problem  has  to  be  faced 
afresh  and  discussed  coolly  in  the  light  of  the  most  urgent  con- 
temporary facts  and  forces. 

A  fair  wage  is  one  which,  in  relation  to  the  work  agreed  upon, 
under  existing  circumstances,  with  the  then  available  facts  and 
taking  account  of  all  active  factors,  the  interested  parties  agree  to  be 
reasonable,  possible  and  expedient. 

The  corporation  whicIT  accepts  this  definition  of  a  fair  wage 
and  acts  upon  the  few  principles  just  set  forth,  as  many  already 
have,  will  find  itself  facing  a  situation  of  greater  stability  and 
confidence  in  wage  relationships  than  is  otherwise  obtainable.1 
Employers  may  not  always  agree  that  a  necessary  course  of 
action  is  the  wisest;  but  they  will  have  under  this  plan  what  is 
today  a  genuine  advantage,  a  knowledge  that  whatever  happens, 
happens  with  both  sides  staring  in  the  face  as  many  of  the  facts 
as  they  are  jointly  prepared  to  consider. 

The  Conference  Committees. — One  further  word  is  necessary 
about  the  organization  of  the  committees  on  job  analysis  and 
wages. 

There  are  certain  general  matters  which  concern  the  work  of 
the  shop  as  a  whole  and  the  pay  of  the  shop  as  a  whole  which 
will  require  determination  prior  to  the  consideration  of  individual 
jobs.  The  number  of  hours  of  work  per  day  and  week,  for 
example,  and  the  minimum  rate  of  pay  for  the  shop,  are  matters 
affecting  all  workers.  Such  items  may  be  discussed  and  acted 
upon  in  the  central  shop  or  works  committee.  This  procedure 
will  not  have  great  draw-backs  if  in  making  decisions  the  group 
is  in  possession  of  the  necessary  facts  which  we  have  enumerated. 
But  usually  in  the  larger  plants,  the  advantage  of  at  once  delegat- 
ing the  special  problems  relatingto  work  and  pay  to  the  respective 
standing  committees  on  those  subjects,  will  be  substantial,  since 
these  groups  can  then  become  expert  on  their  subjects. 

We  propose,  therefore,  that  there  be  a  job  analysis  committee 
at  large  and  a  wage  committee  at  large,  each  composed  of  an 
oqual  number  of  representatives  of  management  and  men.  The 
employee  members  of  this  committee  should  be  selected  in 
whatever  way  is  thought  to  IK;  most  fair;  but  if  a  central  shop 
committee  exists  it  can  usually  pick  these  committees  with  satis- 

1  For  interesting  testimony  regarding  the  success  of  the  conference  method 
see  WOLFE,  A.  B.f  Works  Committees  and  Joint  Industrial  Councils, 
pp.  73-4. 


THE  ELEMENTS  IN  WAGE  DETERMINATION  343 

faction  to  all.     The  job  analysis  committees  at  large  would 
thus  be  constituted  as  follows: 

Representative  of  production  management 
Representative  of  personnel  management 
Representative  of  foremen 
Three  representatives  of  workers  at  large 

And  similarly  for  problems  of  pay  at  large  a  committee  would 
be  constituted  as  follows: 

Representative    of    finance    management 
Representative  of  personnel  management 
Representative  of  foremen 
Three  representatives  of  workers  at  large 

When  it  then  came  to  consideration  of  the  separate  jobs,  the 
only  members  of  these  committees  who  would  need  to  retire 
pro  tern,  would  be  two  representatives  of  the  workers  at  large, 
whose  places  would  be  taken  by  two  representatives  from  the 
job  under  discussion. 

We  suggest  these  details  not  in  order  to  urge  th  e  working  out 
of  this  general  approach  in  any  hard  and  fast,  rigid  system,  or 
by  any  fixed  hierarchy  of  elaborate  committees.  We  have 
no  system.  We  are  only  urging  a  few  simple  principles  which, 
by  way  of  illustration,  it  is  only  fair  for  us  to  picture  as  concretely 
as  is  possible  in  a  general  presentation.  We  not  only  realize 
but  insist  that  it  will  remain  for  every  plant  to  embody  the  idea  of 
consultation  and  agreement  upon  pay  on  a  basis  of  a  previous 
definition  of  work,  in  a  way  adapted  to  its  special  conditions. 

These  suggestions  are,  moreover,  in  no  way  opposed  to  any 
methods  implicit  in  bargaining  with  labor  unions.  If  one  shop 
has  a  collective  bargain  with  the  unions,  it  will  be  easy  and  de- 
sirable to  have  the  conferences  with  the  union  be,  in  effect,  work 
conferences  and  then  pay  conferences.  And  in  these  cases  the 
lowest  grade  at  any  job  would  receive  the  agreed  union  scale  for 
journeymen;  and  the  other  grades,  A  and  B,  would  get  amounts  above 
that,  either  as  agreed  to  with  the  unions  or  with  the  shop  workers 
alone. 

If  it  is  objected  that  the  unions  are  not  prepared  to  bargain 
in  this  way  on  work  and  on  pay  differentials,  the  answer  is  that 
in  some  cases  this  is  true.  But  the  cases  are  also  few  where  em- 
ployers have  gone  to  the  unions,  and  asked  for  conferences  on 


344  PERSONNEL  ADMINISTRATION 

work  amounts  and  pay  differentials,  on  a  basis  of  their  own  re- 
ciprocal promise  not  to  cut  rates,  to  have  joint  agreement  on  job 
study  and  job  grades,  to  have  all  differentials  above  the  minimum 
cost  of  living,  and  to  institute  unemployment  insurance,  an 
annual  wage  or  some  other  form  of  protection  from  insecurity  of 
employment.  And  without  such  a  basis,  it  is  not  to  be  expected, 
or  even  from  a  human  point  of  view  greatly  to  be  desired,  that 
the  unions  should  proceed  to  great  lengths  on  the  principles  here 
outlined. 

Nevertheless,  nothing  can  alter  the  fact  that  conditions  which 
assure  productivity  and  interest  are  those,  broadly  speaking, 
of  differential  pay,  of  security  of  livelihood,  of  joint  study  for 
improved  process,  of  joint  agreement  upon  the  division  of  the 
income,  coupled  with  the  use  of  the  non-financial  incentives  al- 
ready discussed.1  If  the  ends  are  desirable,  then  the  best  means 
to  them  are  worthy  of  serious  consideration.  And  it  remains  for 
the  employers,  the  community,  the  unions  and  the  employees  to 
agree  upon  the  applications  of  those  methods  which  it  is  now 
widely  conceded  will  alone  accomplish  the  desired  results. 

1  "The  report  of  the  Committee  on  Organized  Public  Service  in  the  British 
Building  Industry  found  four  main  factors  (1919)  tending  to  restrict  out- 
put: 

(a)  The  fear  of  unemployment — which  naturally  inclines  the  operative 
to  make  his  work  last  as  long  as  possible. 

(6)  Disinclination  to  make  unrestricted  profit  for  private  employers. 

(c)  Lack  of  interest  owing  to  non-participation  in  the  control  of  the 
industry. 

(rf)  Inefficiency;  both  managerial  and  operative." 

Si-ARKKs,  MALCOLM,  in  The  World  Tomorrow,  v.  2,  No.  12,  p.  321,  December, 
1919. 

Selected  References 

'Sec  end  of  follow  ing  chapter. > 


CHAPTER  XXIV 
PAYMENT  PLANS  AND  METHODS 

Companies  which  have  shop  committees  or  agreements  with 
labor  organizations  have  already  at  hand  the  representative 
machinery  through  which  payment  problems  can  be  taken  up. 
And  it  is  good  business  to  perfect  this  machinery  and  even  to  in- 
troduce it  where  it  does  not  exist. 

But  more  and  more  employers  and  workers  are  not  satisfied 
to  consider  the  problem  solved  when  wage  rates  have  been  estab- 
lished They  desire  to  extend  in  some  way  the  division  of  the 
returns  from  the  business  to  the  profits.  The  motives  for  the 
introduction  of  profit  sharing  are  numerous  and  usually  mixed. 
It  is,  therefore,  particularly  important  to  distinguish  at  the  start 
between  those  proposals  which  are  snatched  upon  by  the  manager 
as  something  of  a  panacea,  and  those  more  carefully  considered 
plans  which  look  toward  a  genuinely  widened  basis  of  control. 

The  manager  who  wants  quick  results  will  usually  find  that 
profit  sharing  is  the  last  thing  he  should  consider.1  Excellent 
critical  studies  exist  of  the  values  and  limits  of  value  of  various 
profit  sharing  projects.  And  no  firm  should  embark  on  such  a 
project  without  giving  these  the  most  careful  reading.2  For  the 
road  of  profit  sharing  is  strewn  with  the  wrecks  of  sanguine  be- 
ginnings and  abandoned  hopes. 

It  may,  indeed,  be  truthfully  said  that  there  is  almost  no  end 
which  profit  sharing  contemplates  which  a  management  cannot 

1  We  heartily  agree  with  the  following  conclusions:  "  Profit  sharing  is  not  a 
problem  to  consider  first.     It  is  the  problem  to  consider  last  .    .    .    (it) 
will  not  destroy  trouble;  it  may  postpone,  alleviate  or  hush  it  temporarily, 
but  it  will  not  overcome  it,  nor  will  stock  sharing,  yearly  wage  dividends, 
nor  memberships  in  thrift  societies.     In  fact,  these  very  good  plans  may 
aggravate  the  employees.     The  warning  is  first  to  put  your  house  in  order. 
The  first  element  of  your  labor  problem  is  to  get  your  basic  system  of  pay 
right.     Profit  sharing  is  not  a  basic  pay  system."     P.  L.  BURKHARD  in 
Industrial  Management,  July  1919,  v.  58,  pp.  42-5. 

2  See   BURRITT,    A.  W.,   and  others.     Profit  Sharing:  Its  Principles  and 
Practice.     N.    Y.,    Harper   &   Bros.,    1918.     Also,    EMMET,  BORIS,   Profit 
Sharing  in  the   United  States,  United  States  Bureau  of  Labor  Statistics 
Bui.  208. 

345 


346  PERSONNEL  ADMINISTRATION 

better  gain  in  some  other  way.  There  is  but  one  exception  to 
this  statement;  that  is,  the  firm  which  has  sincerely  in  view  the 
end  of  making  its  workers  partners  in  the  control  and  results  of 
the  business — the  firm  which  does  actually  want  to  divide  its 
profits. 

We  would  emphasize,  however,  that  we  are  not  necessarily 
advocating  that  any  one  plant  proceed  to  great  lengths  in  the 
division  of  its  profits.  Fundamentally  the  profits  of  one  plant 
are  of  less  significance  to  the  community  and  to  the  workers  than 
the  profits  of  an  industry  as  a  whole.1  Moreover,  we  see  con- 
siderable force  in  the  position  of  those  employers  who  recently 
declared:  "We  cannot  believe  that  either  the  proprietors  or  the 
workers  are  entitled  to  the  whole  of  the  surplus  profits  of  the 
business,  though  they  might  reasonably  ask  for  such  a  share  as 
would  give  them  an  interest  in  its  financial  prosperity  .  .  .  We 
believe  that  in  equity  the  community  may  claim  the  greater  part 
of  surplus  profits  .  .  .  • ,  "2 

But  the  fact  remains  that  individual  plants  desire  to  act,  and 
are  acting,  in  the  direction  of  profit  sharing.  And  believing  that 
there  are  better  and  worse  ways  of  developing  such  a  policy,  we 
shall  proceed  to  lay  down  what  seem  to  us  to  be  the  socially  ex- 
pedient principles' to  govern  this  development. 

But  caution  must  be  observed  in  taking  the  initial  steps.  The 
place  where  control  should  begin  and  where  results  should  show,  so  far 
as  the  manual  worker  is  concerned,  is  first  at  his  own  job.  It  does 
no  particular  good  suddenly  to  elevate  workers  to  boards  of 
directors;  or  suddenly  to  divide  up  profits  so  that  a  worker  finds 
himself  with  a  couple  of  hundred  extra  dollars  to  spend  each 
year.  The  place  to  commence  making  the  workers  actual 
partners  is  at  that  point  where  the  workers  now  are.  In  other 
w(  rds,  the  corporation  which  is  honestly  seeking  to  do  a  service 
to  its  workers  and  to  society  by  a  division  of  profits,  ought  to 
start  in  that  direction  by  providing  a  structure  of  representative 
control  over  certain  of  the  matters  which  help  to  create  the  profits. 

At  the  risk  of  seeming  dogmatic  we  reiterate  that  the  t)est  way 
to  start  where  the  workers  are,  and  where  determining  influences 
are  at  work,  is  to  start  with  job  analysis  under  joint  control. 

1  See  in  this  connection  Shop  Committees  by  ORDWAY  TEAD  in  The 
New  Republic,  v.  19,  pp.  241-3,  June  25,  1919. 

1  Industrial  Relations  Report  of  the  English  Friends,  The  Survey,  v.  41, 
supp.,  Nov.  23,  1918. 


PAYMENT  PLANS  AND  METHODS  347 

In  short,  a  start  should  be  made  with  problems  surrounding  the 
conduct  and  improvement  of  each  job;  and  the  attempt  should  be 
to  build  the  worker's  interest,  the  worker's  knowledge,  the  work- 
er's sense  of  responsibility  and  the  worker's  reward  up  from  the 
place,  the  outlook  and  the  reward  which  he  now  has.  That  will 
lead  to  discussion  and  agreement  about  amounts  of  work,  and 
finally  about  pay. 

In  that  discussion  it  will  be  perfectly  natural  and  normal, 
especially  if  that  is  the  company's  wish,  to  bring  up  for  joint 
consideration  the  fiscal  and  salary  policies  which  help  to  determine 
the  "wages  fund"  which  is  available;  and  to  discuss  any  and  all 
other  relevant  factors.  In  this  way,  employees  will  get  a  knowl- 
edge about  the  financial  situation  which  will  show  whether  the 
proposed  profit  division  is  merely  a  quixotic  venture  or  whether 
it  is  developing  out  of  sound  beginnings. 

But,  it  will  be  objected,  this  is  not  profit  sharing.  No.  It  is 
only  the  beginning  of  a  joint  control  over  process  and  over 
workers'  earnings.  And  it  may  be  objected  that  such  control 
may  eventually  lead  the  workers  to  demand  higher  wages  which 
might  begin  to  encroach  upon  profits.  This  is  not  only  conceiv- 
able under  the  conditions,  but  likely.  Yet  it  should  be  remem- 
bered that  the  management,  under  the  terms  of  our  discussion, 
has  decided  that  it  wants  sincerely  to  share  profits.  And  if  the 
necessary  safeguards  are  thrown  about  the  procedure  of  joint 
conference  and  wage  increase,  it  should  logically  have  no  objec- 
tion to  its  income  going  in  higher  drawing  accounts  than  in  profit 
distribution.  These  safeguards  should  be  substantial  and  they 
should  be  kept  always  to  the  fore.  For  example,  the  fullest  pos- 
sible knowledge  about  financial  affairs  must  be  available  as 
affording  a  basis  for  intelligent  action.  The  relation  of  profits 
to  credits,  to  extensions  of  plant,  to  excess  profit  taxes,  to  wise 
advance  purchases  of  raw  materials — should  all  be  known  and 
patiently  set  forth.  Admittedly  it  would  be  only  under  such 
conditions  that  a  real  broadening  of  the  basis  of  control  could 
wisely  take  place. 

This  proposal  thus  differentiates  itself  sharply  from  the  usual 
profit  sharing  plan  in  which  the  company  is  merely  a  con- 
cessionaire, bountifully  granting  out  of  its  super-abundance 
some  cash  benefits  to  the  employees.  Such  gratuities  are,  of 
course,  neither  fundamental,  of  special  benefit  to  either  side, 
nor  of  any  help  in  solving  the  payment  problem. 


348  PERSONNEL  ADMINISTRATION 

What  is  needed  is  an  arrangement  which  develops  and  uses  as 
fast  as  it  does  develop,  the  interest  of  each  worker  in  the  pro- 
ductivity of  the  enterprise.  If  joint  action  commences  on  prob- 
lems of  work  and  of  pay,  it  can  and  will  if  desired  grow  into 
joint  action  on  larger  issues.  In  this  way,  as  in  no  other,  the 
worker's  relation  to  production  becomes  closer  and  closer;  his 
knowledge  constantly  increases  to  match  his  increasing  responsi- 
bility; his  opportunity  to  exercise  control  and  responsibility 
increases  exactly  as  fast  as  his  desire  (and  usually  faster).  He 
becomes  in  actual  fact  a  sharer  in  the  enterprise.  And  if  under 
these  conditions  he  seeks  to  increase  his  weekly  drawing  account, 
that  would  seem  to  be  a  highly  desirable  step. 

There  would  still  of  course  be  real  danger  that  workers  would 
increase  drawing  accounts  at  the  expense  of  reserves  and  sur- 
pluses necessary  for  profitless  periods  and  extensions.  We  have 
no  desire  to  minimize  this  danger.  But  it  must  be  remembered 
that  under  the  conditions  we  are  assuming  the  employees  knoiv 
that  bad  years  do  occur,  and  that  money  borrowed  of  banks  costs 
more  than  funds  drawn  from  accumulated  surplus.  It  is  inherent 
in  the  educational  value  of  joint  conference  that  workers  come  to 
all  this  knowledge;  and  their  own  native  shrewdness  is  to  be 
counted  on  quite  as  much  as  anyone's. 

But  if  the  business  is  a  prosperous  one  when  this  point  of  a 
determination  of  reasonable  drawing  accounts  has  been  suc- 
cessfully passed,  there  will  still  be  a  residuum — an  ultimate 
surplus — after  the  several  fixed  charges  are  met.  And  the  com- 
pany which  then  desires  on  some  mutually  satisfactory  basis,  to 
divide  up  this  residuum,  will  be  advancing  to  what  seems  to  us 
to  be  as  nearly  as  it  can  be  under  existing  arrangements,  a  "  sound  " 
procedure  of  division. 

But  it  is  necessary  to  be  clear  as  to  how  this  residuum  is  reached. 
For  brevity's  sake  let  us,  therefore,  state  categorically  our  con- 
clusions as  to  the  principles  underlying  this  proposal.  The 
methods  of  determining  the  residuum  will  become  clear  from  this 
statement. 

Certain  Principles  of  "Sound"  Profit  Division. — It  is  a  nec- 
essary  prerequisite  that  there  be  a  joint  definition  of  amounts 
of  work  and  of  related  amounts  of  pay. 

These  amounts  of  pay  should  be  considered  as  drawing  ac- 
counts throughout  the  organization. 

There  should  be  definite  assurances  of  the  continuance  of  the 
plan  independently  of  the  earnings  of  a  particular  year. 


PAYMENT  PLANS  AND  METHODS  349 

There  should  be  joint  agreement  to  the  terms  of  the  profit 
sharing;  joint  administration  of  its  provisions;  and  joint  consent 
to  changes. 

The  company  finances  should  be  in  a  sound  condition;  that  is: 

(a)  There  should  exist  an  agreed  relation  between  stock  values 
and  physical  values. 

(6)  Too  much  money  should  not  be  tied  up  in  raw  stock  or 
in  goods  in  warehouse. 

(c)  Short  time  paper,  if  needed,  should  be  bought  at  bottom 
prices.     If    the    company    could    finance    current   transactions 
cheaper  by  the  maintenance  of  a  reasonable  amount  of  surplus, 
such  surplus  and  such  use  should  be  eventually  provided  for. 

(d)  Plant  should  be  kept  in  first  class  shape  as  part  of  current 
expense.     This  would  apply  to  the  purchase  of  equipment  for 
renewals,  thus  making  a  negligible  depreciation  charge  possible. 

There  should  be  agreement  upon  a  limited  dividend.  This 
should  be  high  enough  to  compensate  stock-holders  so  that  they 
will  have  no  further  claim  on  profits.1 

There  should  be  agreement  as  to  amounts  to  be  set  aside  to 
finance  extensions,  to  create  surplus,  to  create  a  sinking  fund  to  be 
used  to  pay  drawing  accounts,  unemployment  benefits  and  mini- 
mum dividends  in  poor  years.  The  frequently  met  objection  that 
profit  sharing  is  not  fundamental  unless  there  is  also  loss  sharing 
is  beside  the  point  if  the  management  starts  the  plan  in  order  to 
divide  profits.  The  management  is  not  in  any  case  asking  the  em- 
ployees to  assume  the  financial  risk;  that  is  definitely  the  cap- 
italist's function  under  the  present  system.  There  is  good 
reason  to  believe,  however,  that  careful  financing  of  most  cor- 
porations in  good  years  would  make  it  possible  to  lay  by  sufficient 
funds  to  help  appreciably  in  sustaining  the  active  agents  in  the 
business  during  poor  years. 

There  should  be  agreement  as  to  a  minimum  wage,  as  to  the 
maximum  salary  and  as  to  salaries  for  various  grades  of  exec- 
utives. There  should  be  annual  accounting  of  the  company's 
finances  by  an  agreed  accountant  and  access  to  the  books  by 
an  accredited  representative  of  the  workers. 

Any  residuum — ultimate  surplus — left  after  meeting  all  the 

1  In  the  Zeiss  Optical  Works  it  is  provided  that  there  is  a  premium  to 
invested  capital  in  payment  for  the  risk,  corresponding  in  amount  to  the 
average  loss  of  capital  in  the  industry  as  a  whole  over  some  prescribed 
period. 


350  PERSONNEL  ADMINISTRATION 

above  charges  in  the  manner  specified,  would  then  be  divided 
among  the  active  agents  in  the  business;  either  on  a  basis  pre- 
viously agreed  to,  or  on  some  basis  to  be  determined  afresh  each 
year  in  the  light  of  the  circumstances  under  which  the  profits 
are  earned.1 

All  this  will  no  doubt  seem  a  large  order.  And  such  it  is.  We 
do  not  set  it  forth  here  by  way  of  immediate  advocacy  for  every 
firm.  There  will  be  few  firms  so  organized  or  so  disposed,  that 
they  can  in  the  near  future  go  far  in  the  direction  of  these  prin- 
ciples. But  there  arc  some ;  and  there  will  be  more.  And  there 
are  many  others  which  think  they  want  to  share  profits.  If  this 
discussion  will  help  to  clarify  their  thinking  and  supply  a  reason- 
ably wholesome  objective,  its  inclusion  here  will  be  amply  justi- 
fied— no  matter  how  Utopian  it  may  appear  to  the  managers  of 
the  majority  of  companies. 

Stock  Purchase  Plans. — There  has  lately  been  much  advocacy 
of  the  use  of  stock  purchase  by  employees  as  a  method  of  grad- 
ually extending  to  them  a  measure  of  control  over  the  enterprise, 
and  at  the  same  time  increasing  their  income.  The  argument 
runs,  of  course,  that  by  slowly  accumulating  the  stock  of  the 
corporation  the  workers  come  naturally  and  legally  to  the  right 
to  vote  for  the  board  of  directors  and  perhaps  even  to  elect  one 
of  their  own  number  to  the  board. 

Moreover,  it  is  claimed  that  the  ownership  of  stock  gives  a 
sense  of  part  ownership  in  the  business  which  is  a  real  spur  to 
initiative  and  effort;  that  having  such  a  sense  of  ownership  the 
workers  feel  securely  established  in  their  jobs  and  become  bene- 
ficiaries of  the  profits  automatically  in  their  own  right  and  by 
their  own  savings.  They  become  property-holders  and  hence 
develop  the  desire  for  "law  and  order"  which  material  posses- 
sions bring. 

One  trouble  with  this  proposal  is  that  the  workers  do  not  usu- 
ally see  the  value  of  stock  purchase  in  quite  the  above  light.  In 
the  first  place  the  time  factor  is  a  consideration — especially  if 
workers  are  desirous  of  getting  more  adequate  representation 

1  Attention  is  called  to  the  fact  that  this  general  proposal  could  be  applied 
to  an  industry,  no  less  than  to  a  factory.  Moreover  it  ia  not  inconsistent 
with  a  policy  which  requires  a  return  to  consumers  of  a  proportion  of  profits. 
The  most  far-reaching  and  scientific  proposal  made  in  this  direction  is 
contained  in  the  Interim  Report  of  the  Committee  on  Scientific  Management 
and  Reduction  of  Costs,  reprinted  in  the  Industrial  Council  for  the  Build- 
ing Industry,  published  by  Harrison  and  Sons,  London,  1010. 


PAYMENT  PLANS  AND  METHODS  351 

than  they  now  have.  For  them  to  purchase  enough  shares  to 
have  any  real  influence  in  the  directorate  would  usually  require 
several  decades.  But  even  if  this  were  more  quickly  possible,  a 
doubt  arises  as  to  whether,  for  immediate  purposes,  representation 
on  the  directorate  would  bring  the  results  desired  by  the  manage- 
ment as  quickly  as  some  other  method — say,  collective  bargaining. 

There  is  also  in  the  workers'  minds  the  fear  of  becoming  too 
firmly  rooted  at  a  job.  The  workers'  power  in  bargaining,  under 
present  conditions,  comes  in  a  measure  from  a  certain  degree  of 
mobility.  If  a  firm  proves  obdurate  to  their  demands  and  a 
strike  fails,  they  want  to  be  able  to  look  elsewhere  for  work  with- 
out too  much  effort  in  the  way  of  selling  shares  or  even  homes. 

Because  of  this  attitude,  there  is  good  reason  under  any  such 
plan,  for  a  provision  making  it  possible  for  the  employee  on  rea- 
sonable notice  and  without  elaborate  red  tape  to  sell  his  shares 
back  to  the  company.  Various  contingencies  may  arise  which 
make  it  necessary  for  the  worker  (who  lives  anyway  on  a  narrow 
margin  between  income  and  expenses)  to  make  use  of  his  accumu- 
lations. If,  as  is  the  tendency  under  a  stock  purchase  plan,  most 
of  his  savings  are  in  stocks,  they  are  likely  to  be  too  inaccessible 
for  immediate  conversion  into  cash  to  be  convenient  or  safe 
for  him. 

There  is,  also,  the  danger  of  having  all  of  one's  eggs  in  one 
basket.  In  a  well  organized  corporation  making  a  staple  com- 
modity, there  may  be  little  or  no  speculative  risk.  But  for  the 
ordinary  worker  to  have  all  his  savings  in  industrial  stock  is 
certainly  not  a  dictate  of  discretion.  There  is  the  further  diffi- 
culty that,  due  to  causes  quite  beyond  the  control  of  the  factory, 
stock  values  may  fall  below  the  price  paid  by  the  worker.  It 
will  be  said  that  this  is  a  risk  which  every  investor  must  take; 
but  our  point  is  that  the  worker  is  not,  and  should  not  be  ex- 
pected to  be,  in  a  position  to  undertake  this  risk. 

No  one  can  afford  to  take  a  risk  who  has  not  a  margin  above 
the  actual  costs  of  subsistence.  Not  only  is  the  worker's  margin 
narrow  or  even  non-existent,  but  he  has  the  personal  risks  of 
sickness,  unemployment,  old  age  and  death  to  provide  against 
first.  Moreover,  where  the  stock  purchase  is  taking  place  on  an 
installment  payment  basis,  the  employee  who  leaves  has  his 
paid-in  balance  to  recover,  on  which,  of  course,  he  has  not  been 
receiving  interest  unless  the  title  to  the  stock  becomes  his  at  the 
first  payment. 


352  PERSONNEL  ADMINISTRATION 

On  the  whole,  therefore,  stock  purchase  schemes  do  not  appear 
to  offer  any  satisfactory  way  out  of  present  difficulties.  Indeed, 
we  can  generalize  more  widely  and  say  that  no  plan  which  con- 
fines its  organization  and  control  to  a  single  plant  or  group  of 
plants  in  an  industry,  is  really  more  than  a  temporary  step  to- 
ward an  inclusive  representative  organization  of  an  industry  as  a 
whole.  Some  of  the  factors  which  go  far  to  determine  profit  lie 
almost  altogether  outside  the  control  of  the  individual  factory; 
so  that  until  there  is  created  an  organization  competent  to  deal  in 
a  firm  way  with  the  major  economic  influences  at  work  through- 
out an  industry,  no  rock-bottom  attack  has  been  made.  This  is 
not  said  to  deny  the  necessity  for  intra-plant  shop  representa- 
tion in  one  or  another  of  its  forms,  or  to  minimize  the  value  of 
plans  to  encourage  thrift.  We  are  only  urging  that  any  ulti- 
mate determination  of  a  company's  financial  affairs  requires  also 
extra-plant  associations  on  the  side  of  both  managers  and 
workers. 

Payment  Procedure. — There  are  a  number  of  details  about  the 
procedure  of  "paying  off"  to  which  attention  should  be  called, 
since  this  procedure  can  occasion  a  good  deal  of  petty  irritation 
unless  it  is  wisely  handled.  We  state  below  what  experience 
has  usually  shown  to  be  the  best  practice  on  these  matters. 

It  is  desirable  to  pay  off  on  company  time. 

It  is  desirable  to  pay  off  as  rapidly  as  possible.  This  may  be 
accomplished  in  various  ways;  as,  e.g.,  by  having  different  pay 
days  for  different  departments,  or  by  taking  the  pay  envelopes 
directly  to  each  department. 

It  is  desirable  to  pay  up  to  as  near  the  day  of  payment  as  book- 
keeping arrangements  permit.  It  should  usually  bo  possible  to 
pay,  for  example,  on  Saturday  up  to  the  previous  Wednesday. 
The  practice  of  withholding  a  full  week's  pay  is  unnecessarily 
rigorous.  Some  states  have  laws  governing  the  amount  of 
pay  which  may  l>e  withheld,  and  the  frequency  of  payment. 
Usually  a  weekly  settlement  is  to  bo  preferred. 

It  is  essential  to  provide  a  place  and  person  to  whom  the 
workers  can  go  to  secure  adjustments  in  pay  errors.  We  have 
seen  foreign  workers  come  to  the  grated  pay  window  to  get  a 
payment  trouble  straightened  out,  and  receive  the  most  brusque, 
abrupt  and  inconsiderate  treatment  at  the  hands  of  a  young  clerk. 
This  sort  of  occurrence  is  unnecessary;  yet  it  contributes  not  a 
little  to  a  natural  feeling  of  resentment  on  the  part  of  every  self- 


PAYMENT  PLANS  AND  METHODS  353 

respecting  worker.  It  must  be  remembered  that  pay  errors  are 
often  the  company's  mistakes;  but  whether  they  are  or  not,  they 
may  occasion  annoyance  out  of  all  proportion  to  their  serious- 
ness. Hence  the  importance  of  an  attitude  of  courteous,  quick  and 
willing  attention  on  the  part  of  the  pay  adjuster.  Indeed  in  large 
corporations  these  mistakes  and  misunderstandings  become  so 
numerous  with  the  similarity  and  confusion  of  foreign  names  and 
with  foreign  workers  coming  and  going,  that  the  pay  adjuster 
should  either  have  some  facility  in  the  necessary  foreign  languages 
or  have  access  to  sympathetic  interpreters. 

There  should  also  be  a  well  understood  procedure  as  to  paying 
off  those  who  are  absent  on  pay  day.  Regular  hours  of  the  pay 
adjuster's  time  should  be  available  for  this  necessary  service 
throughout  the  week. 

It  is  now  necessary  to  keep  a  record  of  workers'  yearly  earn- 
ings for  income  tax  purposes.  This  information  is  also  valuable 
as  indicating  the  total  earnings  of  workers — figures  which  have 
more  real  significance  than  hourly  or  weekly  rates.  For  this 
reason  we  urgently  recommend  posting  wage  totals  quarterly 
on  the  employees'  record  card  which  contains  the  other  facts 
about  his  history,  progress,  etc.  In  this  way  the  employment 
administrator  can  readily  tell  amounts  of  yearly  income. 

If  the  company  pays  by  check,  it  is  desirable  to  provide  a 
place  where  these  checks  can  be  cashed.  On  the  whole  it  is 
better  to  pay  in  cash. 

It  is  desirable  to  withhold  no  money  from  the  pay  envelope 
for  fines,  dues,  loans,  savings,  grocery  bills  at  company  stores, 
rentals  in  company  houses,  etc.  This  may  seem  a  comparatively 
trivial  point;  yet  it  has  real  psychological  importance.  The 
worker  ought  to  know  where  his  earnings  go ;  and  there  is  no  way 
he  can  know  certainly  unless  he  makes  all  payments  in  cash  him- 
self. Often  this  may  involve  drawing  money  out  at  one  window 
and  paying  it  in  at  another.  That  makes  no  difference;  the 
important  thing  is  for  the  worker  to  handle  all  his  own  financial 
affairs.1 

It  is  desirable  to  have  provisions  for  advancing  a  few  days' 
wages  to  new  employees  who  are  at  the  end  of  their  resources 
when  they  are  taken  on.  Not  a  few  workers,  especially  those  of 

1  There  may  be   an  exception  to   this  statement  in   the   case  of  the 
collection   of  union   dues   under  a   definite   provision   in  the   collective 
agreement. 
23 


354  PERSONNEL  ADMINISTRATION 

the  more  itinerant  type,  will  leave  after  a  couple  of  days  in  order 
to  get  cash  enough  in  hand  to  keep  them  going.  If  an  advance 
on  wages  were  given,  their  stay  would  be  more  permanent.  Some 
companies  have  arrangements  with  boarding  houses  to  accommo- 
date such  new  workers  on  the  company's  credit  for  the  first  week. 

It  is  desirable  to  pay  off  discharged  employees  as  promptly 
as  possible.  Frequently  this  cannot  be  arranged  for  on  the  day 
of  discharge,  but  it  can  be  arranged  for  on  the  following  day. 
It  is  unduly  arbitrary  and  usually  very  inconvenient  to  the  dis- 
charged worker  to  have  his  payment  delayed  until  the  next  pay 
day. 

It  is  important  to  protect  employees  against  loan  sharks  and 
assignments  of  wages.  The  company,  or  preferably  the  em- 
ployees' association,  should  have  a  loan  fund,  and  upon  receipt 
of  notice  of  wage  assignment  soe  the  assignor,  make  an  immedi- 
ate adjustment  (on  the  threat,  if  necessary,  of  legal  proceedings 
if  a  settlement  is  not  made)  and  make  arrangements  with  the 
employee  to  carry  the  obligation  in  some  other  way. 

It  is  important  to  have  a  definite  policy  about  payment  for 
absences  when  they  are  due  to  sickness,  and  for  vacations.  It 
is  customary  on  both  items  to  have  one  policy  for  the  office  force 
and  another  for  the  factory  force.  We  see,  however,  no  reason 
for  not  adhering  to  a  single  standard  for  payment — a  standard 
approximating  the  present  usual  practice  with  office  employees; 
namely,  a  payment  during  sickness  (or  accident)  of  a  few  day's 
duration  after  which  provision  is  made  for  compensation  out  of 
a  benefit  or  compensation  fund;  and  payment  for  a  two  week's 
vacation  for  every  employee  who  has  been  with  the  company  one 
year.  From  the  point  of  view  of  good  hygiene  and  mutual  good- 
will, the  provision  of  an  annual  vacation  with  pay  promises  to 
pay  for  itself  many  times  over.1 

Policies  alxnit  overtime,  Sunday  and  holiday  pay  should  also 
be  clearly  established.  Since  the  usually  accredited  theory  has 

1  "One  of  the  innovations  which  the  plan  provides  is  an  annual  vacation, 
with  pay,  to  all  employees  who  join  the  society.  In  most  companies 
this  advantage  is  given  only  to  the  office  employees  and  the  heads  of  de- 
partments. The  free  vacation  is  favored  l>y  the  Chain  company  officials 
as  a  part  of  the  insurance  against  ill  health  and  as  a  positive  step  to  build 
up  good  health  and  assure  uninterrupted  employment.  A  vacation  bureau 
will  be  conducted  in  this  connection,  to  assist  and  guide  employees  in  their 
choice  of  ways  and  means,  and  when  and  where  to  sjxind  their  vacations." 
Boston  Transcript,  July  25,  1919. 


PAYMENT  PLANS  AND  METHODS  355 

been  to  pay  for  extra  work  in  a  way  that  will  induce  employers 
to  keep  it  at  a  minimum,  we  favor  adherence  to  the  standard 
now  fairly  well  established  where  organized  labor  is  recognized. 
This  standard  calls  for  time-and-a-half  pay  for  overtime  work, 
and  usually  double  pay  for  Sunday  and  holiday  work. 

The  practices  regarding  differentials  in  pay  for  night  work  vary 
from  payment  of  a  bonus  of  a  certain  per  cent,  of  the  day  rate,  to 
no  differential  at  all. 

Women's  Wages. — The  United  States  Govenment  during  the 
war,  and  organized  labor  for  some  time  past,  have  favored  the 
principle  of  "equal  pay  for  equal  work."  Definition  of  the  prin- 
ciple and  its  precise  application  are,  however,  a  difficult  matter. 

It  is,  therefore,  useful  to  examine  this  idea  and  see  what  it  may 
mean.  "Equal  pay"  may  mean  equal  piece  rates,  in  which  case, 
if  women's  hours  are  legally  shorter  than  men's,  they  earn  less. 
It  may  mean  equal  hourly  rates,  in  which  case,  if  their  hours  are 
less,  they  also  earn  less.  It  may  mean  equal  weekly  wages  or 
monthly  salaries,  that  is,  equal  income. 

But  several  different  conditions  have  grown  up  as  to  women's 
pay.  There  are  jobs,  like  cotton  weaving,  where  men  and  women 
are  employed  interchangeably.  In  these  cases,  whether  a  piece 
rate  system  or  a  flat  weekly  rate  obtains,  it  is  usually  felt  that  a 
condition  of  equality  exists. 

There  are  other  jobs  which  have  customarily  been  done  by 
women.  Certain,  work  in  box  and  candy  factories,  garment 
shops,  telephone  exchanges,  etc.,  has  always  been  done  by  women 
and  paid  for  at  a  rate  that  no  man  would  think  of  working  for. 
It  is  for  the  aid  of  women  in  trades  of  this  sort  that  minimum 
wage  legislation  is  designed.  And  it  can  be  fairly  said  that  the 
concept  of  equal  pay  has  never  been  applied  in  these  cases.  The 
assumption  here  is  that  the  adult  woman  is  single  and  without 
dependents,  and  the  pay,  even  when  fixed  under  minimum  wage 
laws,  is  fixed  accordingly. 

Finally,  there  is  the  work  formerly  .done  by  men  for  which 
women  are  now  employed.  During  the  war  this  substitution 
had  its  legitimate  purpose.  During  peace  times  such  substitu- 
tion is  likely  to  mean  that  the  employer  has  discovered  that  he 
can  get  women  more  cheaply  than  men.  For  in  the  great  ma- 
jority of  cases  (and  this  was  true  during  the  war  despite  the  gov- 
ernment's declared  policy)  women  when  taken  on  for  such  work 
as  operating  elevators,  feeding  and  operating  machines,  inspec- 


356  PERSONNEL  ADMINISTRATION 

tion  work  and  hotel  dining  room  service,  are  paid  less  per  hour 
than  the  men  whose  places  they  have  taken. 

It  is  always  said,  of  course,  that  the  women  do  not  do  the  same 
work;  that  modifications  have  to  be  made  on  the  job  to  make  it 
jx)ssible  to  use  them.  Yet  if,  for  example,  a  woman  only  feeds 
a  machine,  whereas  the  man  at  the  job  used  also  to  bring  and 
remove  his  materials,  the  important  fact  to  determine  is  unit 
costs  under  the  two  different  methods.  The  woman  who  only 
feeds  the  machine  may  (and  probably  does)  turn  out  many  more 
units  of  output,  and  the  wage  of  a  male  helper  or  trucker  who 
supplies  not  only  her  but  a  number  of  other  women  with  material 
is  likely  to  be  much  more  than  compensated  for  by  the  total 
increase  of  output.  But,  admittedly,  there  will  be  cases  where 
the  women's  work  is  not  the  same;  and  determination  of  pay  will 
in  these  cases  have  to  be  made  accordingly. 

It  seems  to  us,  therefore,  that  if  interpreted  according  to  the 
spirit  and  not  the  letter,  equal  pay  for  equal  work  means  that  the 
fact  that  women  are  doing  the  work  is  not  to  alter  in  any  way  the 
basis  on  which  pay  shall  be  determined,  and  that  basis,  as  set  forth 
above,  is  that  the  adult  worker  should  receive  at  least  enough  to 
support  him  or  herself  and  several  dependents  at  a  "comfort 
minimum"  standard. 

In  this  definition  several  things  are  to  be  noted.  First,  we 
are  assuming  that  adult  women  have  dependents.  Recent  studies 
indicate  this  to  be  true  of  a  majority  of  women  over  24  or  25 
years  old.  Second,  we  would  call  attention  to  the  word  "adult." 
The  wage  problem  is,  of  course,  altered  for  both  boys  and  girls 
until  their  twenty-first  year  Wages  for  the  worker  up  to  that 
age  can  safely  be  set  on  the  assumption  that  the  worker  is  a 
single  person  with  no  dependents. 

Finally,  we  give  this  definition  not  so  much  by  way  of  advocacy 
of  equal  pay  for  equal  work  as  in  order  that  the  real  implications 
of  the  idea  may  be  grasped.  All  we  have  done  is  to  state  honestly 
what  a  reasonable  construction  of  the  phrase  seems  to  be.  The 
question  eventually  arises,  therefore,  if  this  is  what  equal  pay 
means,  does  society  want  it? 

Think  what  it  would  mean  in  a  cotton  mill  to  apply  this  defi- 
nition strictly.  The  wages  of  women  spinners  and  beam  tenders 
would  in  many  cases  have  to  be  doubled  to  give  a  wage  adequate 
for  the  support  of  an  adult  and  his  dependents.  This  illustration 
calls  attention  to  one  condition  frequently  met  in  textile  centers 


PAYMENT  PLANS  AND  METHODS  357 

which  affects  men's  and  women's  pay  alike  and  has  profound 
social  consequences.  We  refer  to  the  theory  of  the  "family 
wage" — a  theory  which  says  that  if  the  total  of  the  pooled  earn- 
ings of  all  members  of  the  family  is  sufficient  to  meet  the  family 
budget,  a  fair  wage  is  being  paid. 

It  may  be  that  society  will  soon  be  prepared  to  make  the  fate- 
ful decision  that  all  pay  shall  be  on  a  basis  of  individual  self- 
support,  that  all  shall  do  work  for  which  they  will  be  paid  in 
cash,  and  that  those  who  desire  family  life  may  secure  it  by  pool- 
ing the  earnings  of  those  individuals  who  are  to  compose  the 
family  group.  Society  does  not  yet  seem  to  have  made  that 
decision,  however;  and  in  textile  centers  where  the  family  wage 
idea  persists,  the  community  is  really  allowing  the  employer 
to  force  industrial  self-support  upon  every  adult  individual 
in  the  working  class. 

One  of  the  consequences  of  this  extension  of  industrial  work 
enforced  by  economic  pressure  is  seen  in  the  figures  of  infant 
mortality  of  a  city  like  Manchester,  N.H.,  where  many  women 
are  at  work.1 

But,  apart  from  this  complication  of  the  family  wage  idea,  the 
question  must  still  be  seriously  put  as  to  whether  society  wants 
to  face  the  condition  of  the  complete  economic  independence  of 
women  which  an  honest  interpretation  of  "equal  pay"  entails. 

One  benefit  accruing  from  the  full  application  of  this  idea  can 
be  pointed  to.  If  industry  must  pay  men  and  women  alike 
at  any  and  all  jobs,  if  from  the  point  of  view  of  wage  rates  it  is  a 
matter  of  indifference  which  is  chosen;  then  that  sex  will  be 
chosen  for  the  work  which,  all  things  considered,  does  it  best. 

There  would,  in  other  words,  under  equal  pay  be  a  division  of 
labor  along  functional  lines.  Those  jobs  which  men  could  do 
best,  they  would  be  selected  for;  the  jobs  which  women  could 
do  best,  they  would  be  selected  for.  If  the  results  were  the  same 

1  "In  Manchester,  New  Hampshire,  where  there  is  a  great  demand  for 
women  workers  in  the  textile  trades,  679  mothers  (of  those  studied)  were 
erriployed  during  the  year  following  the  baby's  birth;  885  were  not  employed. 
While  the  (mortality)  rate  for  the  babies  of  mothers  who  were  able  to  give 
their  time  to  the  care  of  their  household  was  122,  that  for  babies  whose 
mothers  were  employed  outside  the  house  was  372.9,  and  that  for  mothers 
gainfully  employed  in  the  home — taking  in  washing,  keeping  lodgers,  etc. — 
was  136."  From  CLEVELAND,  F.  A.  and  SCHAFER,  J.  Democracy  in 
Reconstruction.  See  also  the  original  figures  in  Children's  Bureau  Publi- 
cations, No.  20,  Washington,  1917. 


358  PERSONNEL  ADMINISTRATION 

in  both  cases,  both  sexes  would  be  employed.  And  there  is  much 
to  be  said  for  such  a  more  or  less  automatic  adjustment, — pro- 
vided it  is  attended  simultaneously  by  scientific  studies  to  dis- 
cover the  effect  of  different  kinds  of  work  on  workers  of  both 
sexes. 

If  it  be  objected  that  under  such  a  logical  fulfillment  of  the 
equal  pay  condition,  women  might  find  themselves  less  sought 
for  at  certain  work,  the  answer  is  that  this  would  be  true  to  a 
degree  of  both  sexes.  And  to  the  extent  that  women  were  thus 
automatically  shut  off  from  occupations  really  harmful  to  them, 
the  social  gain  would  be  great.  As  it  stands  today  there  is  real 
danger  where  women  can  be  employed  much  more  cheaply 
than  men,  that  those  who  are  to  be  the  mothers  of  the  next 
generation  will  be  in  no  fit  condition  to  exercise  that  indispensable 
function.  Yet  if  a  woman's  individual  income  is  increased  so 
that  it  equals  a  man's,  will  not  the  temptation  to  forego  mother- 
hood altogether  be  a  grave  one? 

It  may  be  thought  that  we  have  thus  reached  no  conclusion  as 
to  desirable  practices  regarding  women's  wages.  But  we  do  not 
forget  that  women's  pay  like  men's  is  properly  subject  for  con- 
sideration in  the  wage  rate  committee  after  study  by  the  job 
analysis  committee.  Our  attempt  above  has  simply  been  to 
present  the  concept  of  "equal  pay"  in  its  various  aspects  and 
implications  It  will  be  necessary  for  each  wage  rate  committee 
(and  for  each  minimum  wage  board  in  our  states)  to  decide  how 
literally  they  choose  to  adopt  equal  pay  and  take  the  conse- 
quences of  really  equal  income  for  the  adult  man  and  woman 
worker  of  equal  competence. 

Foremen's  Salaries. — Efforts  to  determine  foremen's  salaries 
give  rise  to  certain  further  practical  questions.  First,  shall  the 
foreman  get  more  income  than  the  most  highly  paid  piece  worker 
in  the  department?  No  categorical  answer  to  this  is  possible; 
but  our  own  position  is  that  the  foreman  should  be  one  (or  if 
he  is  not,  he  should  be  educated  so  that  he  is  one)  whose  value  to 
the  company  as  an  executive,  as  a  leader  and  dynamic  force  in 
his  department,  is  large  enough  to  warrant  paying  him  well 
above  the  amounts  earned  by  any  of  those  under  him.  A  prom- 
inent executive  of  the  International  Harvester  Company  said 
recently  that  his  company  was  attempting  to  develop  a  group  of 
foremen  whom  it  would  be  justified  in  paying  $5000  a  year. 

Corporations  are  likely  to  demur  at  paying  foremen  well,  both 


PAYMENT  PLANS  AND  METHODS  359 

because  they  fail  to  see  the  importance  of  the  position  and  be- 
cause they  do  not  recognize  that  ability  for  foremanship  is  a 
different  and  more  rare  genius  than  ability  for  manual  work. 
Once  the  thought  that  foremen  are  executives  gains  currency,  the 
question  of  paying  them  more  than  the  best  paid  workers  is 
likely  to  be  less  frequently  raised. 

Suppose,  again,  a  foreman  who  is  not  a  skilled  mechanic, 
has  many  highly  skilled  and  highly  paid  men  under  him,  but 
is  himself  a  good  executive;  should  he  then  be  paid  more  than 
his  best  worker?  It  would  seem  to  us  that  the  arguments  that 
apply  above,  apply  here  also  with  equal  force. 

In  some  cases  foremen  are  paid  a  bonus  if  the  production  of 
their  department  exceeds  a  certain  figure,  or  if  unit  costs  are 
kept  below  a  certain  amount.  Such  devices  may  in  some  cases 
be  necessary  to  create  in  the  foreman  a  willingness  to  do  his  job 
properly;  on  the  other  hand  they  have  sometimes  proved  too 
great  an  incentive  to  an  unwholesome  driving  and  speeding  of  the 
workers  in  his  department.  In  our  experience  a  bonus  to  anyone 
for  doing  something  which  under  right  conditions  he  should  do 
anyway  is  a  poor  second-best  procedure.  The  first  thing  to  do  is 
to  pay  an  adequate  salary  and  pursue  a  program  of  foremen's 
education,  which  will  insure  that  the  foreman,  or  anyone  else, 
knows  his  duties  and  is  interested  to  carry  them  out. 

There  is  perhaps  more  to  be  said  for  profit  sharing  with 
foremen;  and  for  sale  of  stock  to  them.  In  both  of  these  ways 
the  foremen  are  recognized  definitely  in  the  final  results  of  the 
year's  business,  and  this  is  as  it  should  be. 

But  on  the  whole,  we  favor  the  use  with  foremen  also  of  a 
procedure  of  definition  of  work  in  joint  conference  with  a  subse- 
quent determination  of  pay  in  relation  to  work,  along  lines 
analogous  to  those  in  use  with  manual  workers.  In  fact,  we  see 
good  reasons  for  applying  this  idea  also  throughout  the  lower 
ranks  of  office  and  executive  workers. 

There  would,  in  short,  be  selected  out  of  the  foremen's  council 
delegates  to  a  joint  job  analysis  committee  for  foremen;  and  there 
would  also  be  an  equally  representative  committee  of  manage- 
ment and  foremen  on  foremen's  wages.  Thus  the  idea  of  the 
drawing  account  would  apply  to  them;  and  they  would,  where  a 
profit  division  was  instituted,  be  a  party  to  the  distribution  of  the 
surplus  by  means  of  representation  in  the  financial  conference 
which  decided  upon  this  final  disbursement. 


360  PERSONNEL  ADMINISTRATION 

Selected  References 
WAGES 

BULLARD   MANUFACTURING   Co.,   BRIDGEPORT,  CONN.     Bullard  Organiza- 
tion Policies.     Pamphlet  issued  by  company. 
FITCH,  J.  A.     Stretching  the  Pay  Envelope.     (In  Survey,  v.  39,  pp.  411-413, 

Jan.  12,  1918.) 
HOXIE,  R.  F.     Rate  Making,  Modes  of  Payment  and  Maintenance  of  Rates. 

(In  his  Scientific  Management  and  Labor,  1918,  pp.  61-87.) 
Industrial  Relations;  Summary  of  Conclusions  Reached  by  a  Group  of 

Twenty  British  Quaker  Employers  after  Four  Days  of  Discussion  in 

1917  and  1918.     (In  Survey,  v.  41,  Supp.,  Nov.  23,  1918.) 
JONES,  E.  D.    Older  Wage  Systems  and  Newer  Wage  Systems.     (In  his 

Administration  of  Industrial  Enterprises,  pp.  242-290.)    Bibliography 

pp.  289-290. 

RYAN,  JOHN  A.    A  Living  Wage.    N.  Y.,  Macmillan  Co.,  1920. 
VALENTINE,  R.  G.  and  ORDWAY  TEAD.     Work  and  Pay:  A  Suggestion  for 

Representative   Government  in  Industry.     (In  Quarterly  Journal    of 

Economics,  v.  31,  pp.  241-258,  Feb.,  1917.) 
WEBB,  SIDNEY.     Standard  Rate;  Payment  by  Results;  and  Management 

Should  have  Nothing  to  do  with  the  Rate  of  Wages.     (In  his  Works 

Manager  Today,  1918,  pp.  41-102.) 
WEBB,    SIDNEY    and    BEATRICE.     Standard    Rate.     (In   their   Industrial 

Democracy,  1914,  pp.  279-323.) 

PROFIT  SHARING 
BURKHARD,  P.  L.     Fallacy  of  the  Employees'  Profit  Sharing  as  a  Reward  for 

Labor.     (In  Industrial  Management,  v.  58,  pp.  42-45,  July,  1919.) 
BURRITT,  A.   W.  and  others.     Profit  Sharing:  Its  Principles  and  Practice. 

N.  Y.,  Harper  &  Bros.,  1918. 
EMMET,    BORIS.     Profit    Sharing    in    the    United  States.     Wash.,   Govt. 

Print.   Office,   1917.      (U.  S.   Bureau  of  Labor  Statistics  Bui.  208.) 

Bibliography,  pp.  173-188. 
JONES,    E.    D.     Profit    Sharing.     (In    his   Administration   of   Industrial 

Enterprises,  1918,  pp.  253-264.) 

COST  OF  LIVING 

HUDSON,  R.  M.  How  to  Determine  Cost  of  Living  in  an  Industrial  Com- 
munity. (In  Industrial  Management,  v.  56,  pp.  185-191,  Sept., 
1918.) 

LADCK,  W.  J.  Cost  of  Living  and  the  War;  an  Analysis  of  Recent  Changes. 
Washington,  Bureau  of  Applied  Economics,  1918. 

MEEKER,  ROYAL.  What  is  the  American  Standard  of  Living?  (In  U.  S. 
Bureau  of  Labor  Statistics  Monthly  Labor  Review,  v.  9,  pp.  1-13,  July, 
1919.) 

OOBURN,  W.  F.  Measurement  of  Cost  of  Living  and  Wages.  (In  AnnaU, 
Am.  Acad.,  No.  170,  pp.  110-122,  Jan.,  1919.) 

U.  3.  BUREAU  OF  LABOR  STATISTICS.  Prices  and  Cost  of  Living.  (In  each 
issue  of  its  Monthly  Labor  Review.) 


CHAPTER  XXV 
MEETING  THE  INDUSTRIAL  RISKS 

Accidents,  occupational  diseases  and  unemployment  are  risks 
more  directly  incident  to  industrial  work  than  general  sickness, 
old  age  and  death.  But  all  are  contingencies  which  everyone 
in  industry  faces  and  all  stand  as  big  causes  of  anxiety  and  dread 
in  the  working  class  family  unless  some  previous  provision  has 
been  made. 

These  social  risks  are  peculiarly  the  cause  of  fear  and  worry 
when  wages  are  near  the  margin  of  subsistence.  And  until  the 
prevalence  of  this  fear  and  its  effects  are  clearly  understood, 
managers  will  not  realize  the  importance  of  making  some  system- 
atic provision  to  offset  it. 

Fear  is  an  emotion  whose  effect  upon  the  organism  is  depressive, 
repressive,  paralyzing.  It  gives  rise  to  a  state  of  mind  and  body 
which  is  unwholesome  and  abnormal.  It  checks  in  the  individual 
impulses  and  responses  toward  creative  work,  and  positive 
cooperation.  Fear  induces  a  mental  outlook  which  when  it 
becomes  prevalent  in  a  group  literally  makes  impossible  the 
release  of  the  best  social  qualities;  it  fosters  hate  and  thus 
becomes  the  parent  of  the  anti-social  tendencies  and  emotions. 

There  are,  in  other  words,  the  best  of  psychological  as  well  as  of 
economic  reasons  for  making  provisions  in  working  class  life 
which  will  meet  the  inevitable  social  risks. 

The  Method  of  Insurance. — Society  today  uses  the  ingenious 
device  of  insurance  to  distribute  its  familiar  risks  in  such  a  way 
that  all  can  help  to  bear  them  and  all  be  helped  when  they  are  in 
need.  And  the  major  problem  in  respect  to  the  industrial  risks 
is  to  make  use  of  a  form  of  insurance  which  gives  the  best  pro- 
tection. Specifically  this  raises  questions  as  to  the  size  of  the 
group  which  should  undertake  the  insurance,  the  basis  of  select- 
ing the  risks,  the  amounts  of  premiums  and  benefits,  the  degree 
of  compulsion  to  be  exercised  within  the  group,  the  basis  of  shar- 
ing the  premium  payments.  These  and  all  the  actuarial  prob- 
lems entailed  are  in  part  technical  questions  which  it  is  beyond  the 
scope  of  this  volume  to  settle.  But  it  will  be  useful  to  state 

361 


362  PERSONNEL  ADMINISTRATION 

certain  general  points  which  should  be  considered  in  relation  to 
all  insurance  plans,  to  consider  briefly  the  different  kinds  of  risks 
which  must  be  met  and  state  the  kinds  of  problems  to  which  the 
introduction  and  administration  of  each  gives  rise. 

Principles  Having  General  Application. — Up  to  a  certain  point 
the  larger  the  groups  over  which  the  burden  of  risk  can  be 
distributed,  the  smaller  will  be  the  charge  upon  every  participant, 
assuming  the  charge  is  based  upon  actuarial  principles. 

Since  actuarial  advice  is  usually  essential  if  a  plan  is  to  be 
soundly  framed,  it  will  pay  to  consult  a  good  independent  con- 
sulting actuary  after  the  plan  has  been  roughly  sketched  out,  and 
get  all  possible  help  in  creating  a  plan  that  will  not  be  bank- 
rupted by  the  first  epidemic  which  follows. 

Insurance  plans  of  all  sorts  should  be  as  simple  as  possible  in 
respect  to  methods  of  paying  premiums,  securing  benefits  and 
complying  with  all  the  conditions  under  which  the  worker  be- 
comes eligible.  And  payments  of  benefits  should  be  promptly 
made  without  the  necessity  for  the  intervention  of  any  third 
party. 

The  insurance  is  most  effective  if  all  members  of  an  exposed 
group  are  participants.  Where  the  participation  is  compulsory, 
however,  there  should  be  provision  either  for  immediate  refund 
of  his  deposited  principal  with  interest  to  the  worker  who  leaves, 
or  for  transfer  of  the  insurance  to  his  account  in  his  new 
employment. 

Administration  of  the  actual  disbursement  of  insurance  bene- 
fits should  rest  as  far  as  possible  in  the  hands  of  those  who  are  in 
sufficiently  close  touch  with  the  affected  workers  to  know 
definitely  when  he  should  be  a  beneficiary  of  the  fund. 

Accident  Insurance. — Forty-two  states,  including  practically 
all  the  industrial  states,  have  workmen's  compensation  laws.1 
But  the  procedure  under  these  several  laws  varies  widely  in 
respect  to  all  the  important  features.  And  it  holds  tnie  of  com- 
pensation insurance  laws  as  of  most  other  legal  labor  standards, 
that  they  represent  minimum  and  not  the  maximum  desirable 
requirements. 

The  humanly  desirable  standards  over  and  above  the  legal 
requirements  which  any  plant  may  well  adopt  are:  No  waiting 
period  if  the  disability  extends  over  one  week;  payment  of  at 

1  See  HOOKSTADT,  CARL.  Monthly  Labor  Review.  U.  S.  Dept.  of  Labor, 
January,  1920,  pp.  230-247. 


MEETING  THE  INDUSTRIAL  RISKS  363 

least  75  per  cent,  or  80  per  cent,  of  wages  if  not  all  wages  during 
period  of  actual  recovery;  provision  of  adequate  free  medical 
attention;  recognition  that  since  diseases  contracted  because  of 
occupational  hazards  are  of  the  same  character  as  accidents, 
compensation  for  such  diseases  shall  be  on  the  same  basis  as 
accidents. 

Another  feature  of  compensation  plans  that  the  employer 
can  often  usefully  help  to  supplement  is  the  actual  payment 
of  benefits.  Where  long  delays  in  the  decision  and  settlement 
occur,  there  may  result  real  hardship  in  the  family  of  the  injured 
worker;  and  in  anxiety  he  may  even  resort,  unnecessarily,  to  a 
lawyer  to  help  his  case  along.  Managers  should  accept  the 
responsibility  of  making  clear  to  the  workers  that  lawyers  are 
not  usually  necessary;  and  of  advancing  funds  against  the 
payment  of  the  compensation  by  the  state  or  insurance  company. 

In  those  states  where  no  legal  provisions  for  accident  insurance 
exist,  the  enlightened  management  which  sees  the  value  of 
"casting  out  fear,"  will  adopt  voluntarily  the  standards  of 
compensation  of  the  advanced  states. 

Sickness  Insurance. — Mutual  benefit  associations  have  con- 
stituted the  first  organized  step  taken  by  many  firms  to  meet  the 
incidence  of  sickness  upon  their  employees.  A  great  variety  of 
methods  exist  among  the  several  hundred  of  these  associations, 
but  there  are  outstanding  features  of  the  movement  which  can  be 
summarily  considered. 

There  is  wide  agreement  that  membership  in  benefit  associa- 
tions should  be  voluntary.  This  means,  however,  that  much 
thought  must  be  given  to  advertising  the  plan  and  enlisting 
memberships. 

Associations  should  be  administered  cooperatively.  "A  joint 
management  secures  the  counsel  of  the  officers  of  the  corporation 
and  the  interest,  enthusiasm  and  experience  of  the  employees; 
thus  the  organization  is  operated  for  the  best  interests  and  secures 
the  greatest  enthusiasm  of  all  concerned."1 

The  expenses  of  benefit  associations  appear  to  be  satisfactorily 
handled  when  the  employees'  premiums  are  high  enough  to  meet 
the  actual  benefits  paid;  and  when  the  company  pays  whatever 

1  CHANDLER,  W.  L.  Conclusions  From  a  Survey  of  Over  500  Employees' 
Benefit  Associations.  U.  S.  Bulletin  of  Labor,  No.  227,  pp.  158-167.  An 
invaluable  study  for  any  corporation  which  contemplates  the  adoption  of 
a  sickness  benefit  plan. 


364  PERSONNEL  ADMINISTRATION 

administration  overhead  is  necessary  with  perhaps  bonuses  to 
members  for  increasing  the  enrollment  in  the  society.  Funda- 
mentally, however,  it  seems  to  us  that  the  principle  of  joint 
contribution  is  sounder,  especially  since  the  conditions  of  employ- 
ment, which  the  corporation  provides,  influence  the  sickness  rate 
in  a  most  definite  way. 

The  method  of  regular  weekly  dues  of  a  fixed  amount  is  gen- 
erally recognized  as  sound  and  Mr.  Chandler  finds  that  with 
dues  of  ten  cents  per  week  the  fund  can  under  ordinary  conditions 
pay  each  sick  worker  $1  a  day  after  the  third  day  of  sickness  for  a 
period  not  to  exceed  thirteen  weeks.  "  If  it  was  desired  to  extend 
these  benefits  as  long  as  disability  continued,  it  would  be  neces- 
sary to  add  only  two  cents  per  week  per  member."1 

For  the  addition  of  2.5  cents  a  week  to  the  premium  he  finds 
also  that  a  death  benefit  of  approximately  $100  can  safely  be  paid 
to  members  dying  of  sickness. 

These  figures  of  the  relation  of  cost  to  benefits  are  given,  it 
should  be  understood,  only  by  way  of  illustrating  the  relative 
proportion  which  premiums  must  bear  to  compensation.  Under 
present  conditions  benefits  of  one  dollar  a  day  while  better  than 
nothing,  are  wholly  inadequate  to  meet  the  needs  of  workers  in 
a  period  of  sickness.  Benefits  of  double  this  amount  come  nearer 
to  a  desirable  amount,  and  if,  as  is  possible,  larger  benefits  require 
a  premium  which  the  employee  feels  is  too  high  for  him  to  pay, 
his  contribution  must  be  supplemented.  Indeed,  joint  contri- 
bution of  employer  and  workers  in  employee  benefit  funds,  seems 
from  every  point  of  view  the  more  satisfactory  arrangement. 

A  typical  benefit  plan  sets  forth  its  essential  provisions  in  the 
following  terms: 

"Any  member  of  this  society  in  good  standing  is  entitled  to  receive 
a  benefit  of  $1  a  day — Sundays  not  included — during  such  time  as  they 
shall  be  incapacitated,  through  sickness  or  injuries,  for  performing  his 
duties  as  an  employee. 

"  Benefits  to  take  effect  on  the  fourth  working  day  after  sickness  or 
injuries.  Benefits  not  to  exceed  13  weeks  in  a  calendar  year.  In 
all  cases  of  sickness  or  injuries,  the  secretary  of  the  association  must  be 
notified  in  writing  at  once  or  claims  for  benefits  will  not  be  allowed. 

"  No  member  shall  be  entitled  to  benefits  for  any  sickness  or  injury 
which  shall  have  been  caused  or  brought  about  by  the  use  of  intoxicating 
liquors  or  opiates,  or  by  immoral  conduct,  and  no  member  having  » 

1  CHANDLER,  W.  L.     Op,  cit.,  p.  164. 


MEETING  THE  INDUSTRIAL  RISKS  365 

chronic  disease  or  ailment  previous  to  joining  the  association  shall  be 
entitled  to  benefits  for  disability  therefrom. 

"The  president  shall,  on  all  such  cases  brought  to  the  attention  of  the 
secretary,  appoint  a  sick  or  visiting  committee,  consisting  of  three 
members,  or,  if  a  nurse  is  employed  by  the  company,  of  four  members, 
one  of  whom  shall  be  the  nurse."1 

Group  Insurance. — In  recent  years  the  commercial  insurance 
companies  have  been  selling  policies  under  which  all  employees 
of  one  corporation  "are  insured  against  loss  in  case  of  death 
from  any  cause,  or  disability,  during  the  term  of  their  employ- 
ment by  means  of  a  single  blanket  contract  issued  against  the 
employer  by  an  insurance  company." 

This  insurance  has  thus  been  typically  a  life  insurance  only, 
for  which  the  premiums  have  been  met  by  the  employer,  and  the 
administration  has  been  entirely  in  the  hands  of  the  insurance 
company  and  the  employer.  The  following  statement  is  a  con- 
venient summary  of  the  usual  characteristics  of  the  group  plan: 

"The  usual  formula  adopted  by  employers  has  been  on  a  serv- 
ice basis.  The  employer  furnishes,  for  illustration,  a  minimum 
amount  of  $500  life  insurance  to  employees  who  have  completed 
six  months  of  service,  increasing  this  amount  by  an  additional 
$100  for  each  year  of  service  up  to  a  maximum  of  $1,000  after 
five  years  of  service,  or  $1,500  after  10  years  of  service.  In 
event  of  the  employee  leaving  the  service,  insurance  under  the 
group  form  is  discontinued,  but  the  employee  may  be  given  the 
option  of  continuing  life  insurance  under  a  regular  individual 
policy  without  the  necessity  of  passing  a  medical  examination. 

"The  approximate  cost  of  group  life  insurance  depends  upon 
the  combined  costs  of  the  various  ages  of  the  employees.  This 
cost,  however,  averages  usually  from  $4  to  $5  per  annum  for  each 
unit  of  $500  of  life  insurance.  No  medical  examination  is  required 
at  the  start  provided  a  satisfactory  percentage  of  employees 
becomes  enrolled,  and  no  medical  examination  is  required  of  new 
employees  who  come  under  this  insurance  after  six  months' 
-service. 

"Each  employee  receives  a  separate  individual  certificate 
stating  his  own  protection  with  whatever  imprint  or  announce- 
ment the  concern  desires  to  make  in  connection  therewith. 
Under  the  group  life  insurance  provision  employees  are  also 

1  TEWKSBTJRY,  W.  J.  Helping  Workers  to  Help  Themselves.  Factory, 
August,  1919. 


366  PERSONNEL  ADMINISTRATION 

usually  protected  by  payment  of  the  full  proceeds  in  the  event 
of  total -and  permanent  disability  from  accident  or  disease  incurred 
before  reaching  the  age  of  60." l 

Recently,  however,  there  have  been  modifications  in  the  kind 
of  group  insurance  sold.  Certain  policies  include  provisions 
for  joint  administration  of  the  insurance  by  local  management 
and  men,  joint  contributions  and  the  inclusion  of  sickness  as 
well  as  death  benefits.  These  features  make  the  plan  more  a 
cooperative  undertaking  and  thus  remove  some  of  the  usual 
working  class  objections.  It  is  probably  still  true,  however, 
that  in  a  company  of  any  size  the  same  benefits  as  the  group 
policy  offer  can  be  obtained  under  a  cooperative  company  fund 
at  a  somewhat  less  expense.  But  to  conduct  such  a  cooperative 
benefit  association  successfully,  the  company  must  receive 
competent  actuarial  advice  in  advance  in  order  to  bring  the 
amount  of  required  premiums  into  right  proportion  to  the  bene- 
fits to  be  offered.  And  this  can  only  be  done  when  the  sickness 
and  death  rate  of  the  plant  is  known  and  when  the  total  amount 
of  money  available  for  the  insurance  fund  is  agreed  upon. 

Group  insurance,  as  ordinarily  administered,  therefore,  even 
though  it  may  bring  genuine  benefits  to  the  workers,  fails  to  take 
account  of  their  psychology.  Its  defects  in  this  connection  may 
be  better  seen  by  a  comparison  with  the  mutual  benefit  society. 
Speaking  of  the  latter  type  of  organization,  Mr.  Chandler  after 
his  extensive  study  says, 

"The  association  is  in  the  business  of  selling  insurance;  it  must  have 
a  proposition  which  can  be  readily  sold  to  the  employees.  We  were 
able  to  show  them  some  of  the  psychological  features  of  the  proposition, 
not  through  a  definite  study  of  psychology,  but  by  bringing  them  to  see 
the  effect  on  prospective  members  of  certain  methods  of  procedure. 
One  point  that  was  kept  forcibly  in  mind  continuously,  was  this — 
the  entire  plan  of  reorganization  must  be  above  suspicion.  There 
must  be  nothing  about  it  which  would  permit  the  suggestion,  by  those 
of  perverted  mind,  that  the  corporation  had  any  motive  other  than  the 
best  interests  of  the  employees.  All  decisions  were  to  be  made  by 
the  employees.  We  took  pains  to  place  before  them,  however,  all  of 
the  facts,  both  for  and  against  each  proposition  on  which  they  were  to 
ballot,  so  that  they  were  benefited  by  the  experience  and  judgment  of 
those  who  had  experience  in  insurance  matters,  sales  promotion,  and  in 
addition,  the  facilities  for  securing  information."1 

1  RICE,  E.  E.  Group  Insurance  for  the  Industrial  Worker.  Industrial 
Management,  March,  1910. 

»  CHANDLER,  W.  L.    Op.  tit.,  p.  161. 


MEETING  THE  INDUSTRIAL  RISKS  367 

Public  Health  Insurance. — There  remains  to  consider  as  a 
means  of  meeting  the  sickness  hazards,  the  kind  of  public  health 
insurance  which  has  been  in  successful  use  in  England  since 
1911,  and  which  is  now  being  vigorously  urged  in  the  legislatures 
of  several  of  our  own  states. 

Briefly  the  plan  of  this  insurance  is  to  require  the  insuring  of 
practically  all  industrial  workers,  on  a  basis  of  contributions 
made  weekly,  40  per  cent,  by  the  employer,  50  per  cent,  by  the 
employee,  and  10  per  cent,  by  the  state.  The  amount  of  the 
employee's  contribution  would  probably  approximate  25  cents 
a  week 

In  return  for  these  payments,  benefits  of  a  certain  per  cent,  of 
wages  (probably  two-thirds,  with  a  minimum  of  $5  and  a  maxi- 
mum of  perhaps  $8  a  week)  for  twenty-six  weeks,  free  medical 
and  hospital  service,  maternity  benefits  and  a  death  benefit 
of  not  more  than  $100  would  be  provided;  the  administration 
of  the  benefits  to  be  through  local  groups  on  an  industrial  or 
geographic  basis. 

Inasmuch  as  existing  statistics  of  sickness  show  that  each 
worker  in  this  country  averages  in  the  neighborhood  of  nine  days 
of  sickness  per  year,  there  is  indeed  good  reason  for  considering 
some  way  of  compensating  for  sickness,  which  is  universal  and 
independent  of  the  forethought  of  the  individual  corporation  or 
its  employees.  And  despite  the  objections  urged  against  it  from 
various  points  of  view,  it  seems  probable  that  public  health  in- 
surance along  lines  already  embodied  in  proposed  bills  will  meet 
the  immediate  needs  better  than  any  other  method  which  would 
have  any  reasonable  likelihood  of  adoption.  It  will,  as  a  mini- 
mum, do  one  invaluable  service;  it  will  in  a  dramatic  way  call 
attention  to  the  extraordinary  amount  and  cost  of  sickness  which 
results  today;  and  thus  will  lead  to  the  more  vigorous  preventive 
measures  of  public,  industrial  and  personal  hygiene  which  the 
community  is  otherwise  so  slow  to  adopt. 

Unemployment  Compensation. — Application  of  the  insurance 
idea  to  unemployment  has  been  relatively  slow  in  coming,  pri- 
marily because  of  the  frightful  irregularity  of  industrial  employ- 
ment in  the  last  fifty  years  and  the  consequent  high  cost  of 
adequate  insurance.  England  has  a  national  unemployment 
insurance  which  is  constructed  along  lines  similar  to  its  health 
insurance,  although  it  is  confined  to  selected  trades.  There 
are  other  types  of  public  unemployment  benefits  on  the  continent. 
And  a  good  deal  has  been  done  by  the  labor  unions  in  Europe 


368  PERSONNEL  ADMINISTRATION 

in  paying  out-of-work  benefits  to  their  idle  members.  In  this 
country  such  union  provisions  are  confined  to  the  members  of 
two  or  three  organizations. 

Apart  from  these,  any  practical  attempts  in  this  country  to  pay 
workers  who  are  unwillingly  unemployed  have  been  exceedingly 
rare.  Much  thought  is  being  given  to  the  matter,  however, 
and  the  proposals  take  two  forms. 

They  take,  first,  the  form  of  an  annual  wage  to  be  guaranteed 
by  the  corporation  with  the  responsibility  then  on  the  manage- 
ment to  provide  work  to  keep  its  people  busy.  This  proposition 
is  receiving  serious  consideration  in  one  of  the  industries  where 
the  tradition  of  collective  bargaining  is  strong  and  where  the 
unions  are  urging  the  importance  of  regular  employment. 

And,  second,  there  is  the  plan,  already  adopted  by  one  com- 
pany, of  laying  aside  a  surplus  fund  out  of  which  unemployment 
benefits  would  be  paid  to  employees  in  good  standing  during  idle 
weeks.  The  following  resolution  was  adopted  by  this  company 
in  the  summer  of  1919: 

"VOTED,  that  inasmuch  as  the  basis  of  our  Partnership  Agreement  is 
the  payment  to  both  Labor  and  Capital  of  a  living  wage  which  shall 
be  constant,  and  inasmuch  as  our  industry  suffers  from  periodical 
periods  of  depression  during  which  full  employment  is  impossible  and 
so  Labor  does  not  receive  its  living  wage,  that  also  during  which  profits 
shrink  or  losses  occur  so  that  Capital  does  not  receive  its  wage,  the 
Board  of  Directors  set  aside  from  the  Net  Earnings  remaining  after  the 
payment  of  wages  to  both  Capital  and  Labor  as  a  Sinking  Fund,  15% 
of  such  Net  Earnings. 

"This  fund  to  be  limited  to  $250,000. 

"When  this  sum  is  reached  no  further  payment  shall  be  made  unless 
the  sum  becomes  depleted  when  the  Sinking  Fund  shall  again  go  into 
effect. 

"This  fund  shall  be  used  to  pay  half  wages  to  all  regular  employees 
who  may  suffer  during  such  periods  of  depression  from  the  closing  of  the 
plant,  or  any  of  its  departments. 

"VOTED,  that  the  details  of  the  plan  under  which  this  fund  shall 
be  administered  be  left  to  the  joint  action  of  the  two  Boards  of  Manage- 
ment (of  the  Dutchess  and  Rockland  Branches). 

"VOTED,  that  a  similar  Sinking  Fund  of  the  same  percentage, 
limited  to  the  same  amount,  shall  I ><•  set  aside  each  year  as  a  guarantee 
to  Capital  of  its  minimum  return  (6%)  during  years  when  this  shall  not 
be  earned."1 

•Quoted  from  Rleachery  Life,  August  5,  1919,  published  by  Garner  Print 
Works  &  Bleachery,  Wappinger  Falls,  N.  Y. 


MEETING  THE  INDUSTRIAL  RISKS  369 

There  will  undoubtedly  be  other  plans  of  a  similar  character 
put  into  effect  in  the  near  future  by  those  employers  who  see 
the  close  relation  of  security  of  livelihood  to  efficiency.  But  it 
should  be  remembered  that  any  far-reaching  attack  upon  the 
problem  by  such  plans  is  out  of  the  question.  Unemployment  is 
basically  a  risk  created  not  by  the  employer  or  the  workers  but 
by  the  nature  of  our  industrial  organization.  And  the  burden 
of  this  risk  will  only  be  fairly  distributed  when  it  is  assumed  by 
the  whole  community  under  a  public  unemployment  insurance 
plan.1  This  was  the  determining  consideration  in  the  creation 
of  a  national  plan  in  England.  And  sooner  or  later  the  economy 
of  such  insurance  will  commend  itself  to  us  here. 

Meanwhile  all  that  any  one  firm  or  industry  can  do  to  lighten 
the  burden  of  involuntary  idleness  will  be  a  boon  to  its  workers 
and  a  business  asset  to  itself. 

Old  Age  Pensions. — The  problem  of  old  age  pensions  is  a 
thorny  one;  it  bristles  with  difficulties.  Shall  the  pension  be 
contributory  or  non-contributory?  Who  is  to  determine  the 
employees'  eligibility?  Does  a  striking  employee  cease  by  that 
fact  from  employment?  Does  the  individual  employee  who 
leaves  have  any  moral  claim  upon  any  part  of  the  fund? 

Mr.  John  A.  Fitch  in  an  excellent  discussion  of  this  subject 
summarizes  the  present  situation  by  saying  that,  "there  is 
nothing  new  about  the  establishment  of  pension  funds  by  em- 
ploying corporations  in  the  United  States.  Indeed,  the  develop- 
ment of  such  systems  has  been  rapid  in  the  last  decade,  and  the 
reason  is  obvious  enough.  What  to  do  with  the  superannuated 
employee  is  a  question  that  has  to  be  faced  sooner  or  later  by 
every  employing  concern.  The  presence  in  the  workshop  of 
men  who  are  no  longer  able  to  do  their  full  share  of  the  work  is 
demoralizing  and  makes  for  inefficiency,  but  what  is  to  be  done 
with  such  men?  Many  an  employer  has  adopted  a  make-shift 
policy;  he  tries  to  find  light  work  for  the  old  employee;  he  creates 
a  job  for  him  of  no  particular  importance  or  value  to  the  shop, 
or — crowning  indignity  after  years  of  efficient  and  faithful  service 
— he  makes  him  a  watchman.  As  the  size  of  the  concern  in- 
creases such  methods  tend  to  become  impossible  as  remedies  for  a 

1  Those  interested  to  see  what  such  a  law  might  be  in  this  country  should 
examine  Bulletin  No.  2.  Unemployment  Insurance  for  Massachusetts, 
published  by  the  Massachusetts  Committee  on  Unemployment,  January, 
1916,  Boston. 

21 


370  PERSONNEL  ADMINISTRATION 

situation  that  is  constantly  growing.  Of  course,  another  alter- 
native is  to  discharge  a  man  outright  as  soon  as  his  powers  begin 
to  decline.  Few  employers  wish  to  do  so  inhumane  a  thing."1 

And  after  a  valuable  review  of  the  best  existing  plans  he  con- 
cludes that:  "Whether  or  not  it  is  deliberately  intended,  most 
industrial  pension  rules  are  so  drawn  as  to  make  possible  very 
serious  limitations  on  the  rights  and  freedom  of  action  of  the 
employees.  The  importance  of  this  fact  is  not  materially  lessened 
by  the  probability  that  the  exceptional  power  thus  given  the 
employer  is  seldom  exercised.  Although  the  employee  has  no 
rights,  under  the  plans  most  generally  prevailing,  either  to  a  job, 
or  to  a  pension,  or  to  the  continuance  of  payments  once  the 
pension  has  been  awarded,  it  is  altogether  likely,  as  a  matter  of 
practice,  that  he  is  not  denied  any  of  these  things.  Only  one 
case  has  ever  come  to  the  attention  of  the  writer  where  such 
rules  were  utilized  to  coerce  the  employees. 

"As  a  man  grows  older  in  the  service,  the  pension  becomes 
more  and  more  of  a  club  in  the  hands  of  the  employer  with 
which  to  enforce  'loyalty'  and  subservience.  Suppose  the 
retirement  age  is  sixty-five  and  the  service  required  is  twenty 
years;  a  man  sixty  years  old  who  has  been  fifteen  years  in  the 
service  will  hesitate  before  protesting  against  shop  conditions  that 
need  remedying.  He  is  not  likely  to  be  active  in  the  union,  and 
if  there  is  discussion  of  a  strike,  he  is  likely  to  be  against  it. 
There  is  a  barrier  of  only  five  years  that  separates  him  from 
retirement  and  provision  for  his  old  age.  But  even  if  ho 
negotiates  those  years  in  safety  and  finds  himself  upon  the  pension 
roll,  in  many  cases  he  is  still  without  his  freedom.  He  is  a 
pensioner  and  dependent;  he  dare  not  speak  his  mind  freely  lest 
he  be  guilty  of  'misconduct'  and  the  stipend  which  keeps  him 
from  the  poorhouse  be  taken  away. 

"The  whole  difficulty  about  industrial  pensions  is  the  fact 
that  the  theory  on  which  they  are  based  is  fundamentally  unsound. 
If  it  is  nothing  but  a  means  of  getting  superannuated  employees 
out  of  the  shop  without  doing  too  much  violence  to  one's  humane 
instincts,  the  pension  is  pure  charity.  If,  through  the  postponing 
of  payments  and  even  the  decision  whether  there  are  to  be  any, 
to  the  end  of  a  long  period  of  service,  the  pension  is  to  be  used  as 
a  means  of  warding  off  strikes  and  inducing  continuity  of  service, 
it  is  nothing  more  or  less  than  a  bribe."1 

1  FITCH,  JOHN  A.     For  Value  Received.     A  Discussion  of  Industrial 
Pensions.     The  Survey,  May  25,  1018,  p.  221. 
•  FITCH,  JOHN  A.    Op.  cil.,  pp.  223-224. 


MEETING  THE  INDUSTRIAL  RISKS  371 

Discussion  of  the  need  of  providing  for  old  age  cannot  satis- 
factorily be  left  in  this  negative  way,  however.  Employers  do 
want  to  act  and  they  will  act  increasingly  to  offer  compensation 
to  retired  workers.  And  their  plans,  it  would  seem,  can  to  a 
large  extent  meet  the  difficulties  above  cited  if  their  administra- 
tion is  a  joint  one  of  managers  and  men,  under  which  there  is 
joint  agreement  as  to  what  constitutes  continuity  of  service, 
eligibility  for  the  pension,  misconduct,  etc. 

But  here  again,  the  fundamental  difficulty  is  a  deeper  one. 
Old  age  is  a  universal  hazard,  and  until  the  community  as  a 
whole  is  willing  to  share  its  incidence  by  some  public  scheme,  the 
cost  will  fall  unduly  upon  each  corporation  which  is  generous 
enough  to  adopt  a  plan. 

Savings  Funds. — One  way  to  help  meet  the  industrial  risks, 
which  involves  no  effort  on  the  company's  part  which  employees 
can  misconstrue,  is  to  encourage  the  organization  of  savings 
funds.  Regular  provision  for  laying  aside  a  stated  amount,  or 
any  amount,  per  week  is  made  in  an  increasing  number  of  plants; 
and  there  is  everything  to  commend  the  plan  if  its  administra- 
tive details  are  wisely  handled. 

The  fund  should  be  handled  by  the  employees  in  cooperation 
with  the  company. 

If  the  company  will  pay  at  least  savings  bank  interest  on  the 
total  deposits,  it  is  usually  convenient  to  let  it  hold  the  funds. 

Withdrawals  should  be  allowed  at  short  notice — not  more  than 
a  week  and  not  less  than  twenty-four  hours.  However,  every 
inducement  should  be  held  out  to  let  the  fund  accumulate  for 
specific  purposes  like  paying  for  the  winter's  coal  or  the  summer 
vacation. 

Some  one  or  a  number  of  people  should  be  charged  with  the 
responsibility  of  regular  collection  each  week,  on  or  immediately 
after  pay-day. 

Life  Insurance. — Over  80  per  cent,  of  the  mutual  benefit 
plans  include  a  death  benefit  provision  when  death  is  due  to 
either  accident  or  sickness. 

Many  if  not  most  of  the  group  insurance  plans  provide  a 
death  benefit. 

And,  of  course,  the  bulk  of  the  business  of  many  commercial 
insurance  companies  is  in  the  so-called  industrial  policies  for 
which  the  worker  pays  a  premium  of  from  ten  to  twenty-five 
cents  a  week  for  a  benefit  of  from  $100  to  $500. 


372  PERSONNEL  ADMINISTRATION 

It  seems  to  us  doubtful  whether,  beyond  the  point  of  coopera- 
tive action  in  benefit  societies,  there  is  any  great  value — speaking 
from  the  point  of  view  of  administration — in  a  blanket,  non- 
contributory  life  insurance  policy  offered  by  the  corporation. 
It  amounts,  of  course,  to  a  compulsory  saving  which  has  its  merits 
and  its  value  to  the  employee.  But  the  provision  is  open  to  the 
same  criticism  of  charity  and  paternalism  which  the  workers  have 
raised  from  time  to  time  against  all  group  insurance  and  company 
pensions.  We  are  not  arguing  against  the  importance  of  life 
insurance;  we  are  only  calling  into  question  its  value  to  the  cor- 
poration comparatively  to  the  value  of  putting  the  same  amount 
into  wages,  or  into  a  cooperative  plan  of  action  with  the  employ- 
ees' benefit  association. 

Conclusion. — We  recognize,  however,  in  relation  to  all  these 
industrial  risks  that,  immediately  at  least,  considerations  of 
expediency  will  and  should  prevail.  And  if  in  the  near  future  the 
enlightened  employer  can  afford  to  and  will  help  to  meet  the 
risks  by  insurance  plans  of  his  own  proposing,  the  burden  upon 
thousands  of  workers  will  be  greatly  lightened  and  everyone  may 
be  the  gainer.  But  the  danger  is  that  such  proposals,  scattered 
as  they  necessarily  are  in  occasional  plants,  will  be  used  as 
arguments  against  the  need  of  really  public  provision  in  all  plants 
for  sickness,  unemployment  and  old  age  when  that  need  shall 
come  to  be  more  publicly  felt  than  it  now  is.  Ultimately  the 
scientific  and  human  arguments  for  distributing  the  burden  of 
these  inescapable  risks  among  all  groups  in  the  community 
seem  to  us  unanswerable. 

Selected  References 

Benefit  Societies 

CHANDLER,  W.  L.  Conclusions  from  a  Survey  of  over  500  Employees' 
Benefit  Associations.  (In  U.  S.  Labor  Statistics  Bureau,  Bulletin  No. 
227,  pp.  158-172,  October,  1917.) 

CHANDLER,  W.  L.  Employees'  Benefit  Association.  (In  Industrial  Man- 
agement, N.  Y.,  v.  55,  pp.  34-39,  109-115,  219-224,  293-297,  405- 
470;  v.  56,  pp.  12-16.  Jan.-Apr.,  June-July,  1918.) 

COMMONS,  J.  l{.  Industrial  Goodwill.  N.  Y.,  McGruw-Hill  Book  Co., 
1919.  pp.  92-105. 

TEWKHBURY,  W.  J.  Helping  Workers  to  Help  Themselves.  (In  Factory, 
v.  23,  pp.  276-277.  August,  1919.) 


MEETING  THE  INDUSTRIAL  RISKS  373 

Industrial  Insurance 

AMERICAN  ASSOCIATION  FOB  LABOR  LEGISLATION.  Brief  for  Health  In- 
surance. Special  Articles.  Representative  Comment.  (In  its  Ameri- 
can Labor  Legislation  Review,  v.  6,  No.  2,  June,  1916.) 

KIMBALL,  H.  W.  Group  Insurance.  (In  Industrial  Management,  v.  57, 
pp.  154-156,  Feb.,  1919.) 

RICE,  E.  E.  Group  Insurance  for  the  Industrial  Worker.  (In  Industrial 
Management,  v.  57,  pp.  234-236,  March,  1919.) 

RUBINOW,  I.  M.     Social  Insurance.     N.  Y.,  Henry  Holt  &  Co.,  1913. 

RUBINOW,  I.  M.  Standards  of  Health  Insurance.  N.  Y.,  Henry  Holt  & 
Co.,  1916. 

SEAGER,  H.  R.  Social  Insurance;  a  Program  of  Social  Reform.  N.  Y., 
Macmillan  Co.,  1919. 

U.  S.  BUREAU  OP  LABOR  STATISTICS.  Group  Insurance.  (In  its  Bui.  No. 
250,  1919,  pp.  110-112.) 

WARREN,  B.  X.  and  EDGAR  SYDENSTRICKER.  Health  Insurance;  its  Re- 
lation to  the  Public  Health.  Washington,  Govt.  Print.  Off.,  1916. 
Bui.  No.  76. 

WHITNEY,  A.  W.  Health  Insurance.  (In  Efficiency  Society  Journal,  v.  7, 
pp.  462-471,  Sept.,  1917.) 

Industrial  Pensions 

BLOOMFIELD,  MEYER.  Plan  of  Pensions  for  the  Employees  of  the  Ludlow 
Manufacturing  Associates.  (In  his  Labor  and  Compensation,  1918. 
pp.  401-420.) 

FITCH,  J.  A.  For  Value  Received;  a  Discussion  of  Industrial  Pensions. 
(In  Survey,  v.  40,  pp.  221-224,  May  25,  1918.) 

RICE,  E.  E.  Cooperative  Insurance  and  Pension  System.  (In  Electric 
Railway  Journal,  v.  29,  pp.  292-296,  June,  1916.) 

RUSSELL  SAGE  FOUNDATION  LIBRARY.  Industrial  Pensions;  a  Selected 
Bibliography.  N.  Y.,  Russell  Sage  Foundation,  1919  (Russell  Sage 
Foundation  Library.  Bui.  38,  December,  1919.) 

U.  S.  BUREAU  OF  LABOR  STATISTICS.  Private  Companies  in  the  United 
States  Having  Old  Age  Pension  System.  (In  its  Monthly  Review,  v.  2, 
pp.  644-646,  June,  1916.) 

WHITNEY,  A.  L.  Establishment  of  Disability  Funds,  Pension  Funds  and 
Group  Insurance  for  Employees.  (In  U.  S.  Bureau  of  Labor  Sta- 
tistics. Monthly  Review,  v.  6,  pp.  444-460,  Feb.,  1918.) 


CHAPTER  XXVI 
COORDINATION  OF  STAFF  DEPARTMENTS 

It  is  the  purpose  of  this  chapter  to  consider  how  policy  is  best 
adopted,  transmitted  and  put  into  effect.  Especially  are  we 
concerned  to  see  how  personnel  policy  or  the  policies  of  other 
departments  where  they  are  affected  with  a  human  interest, 
are  "put  across."  The  problem  is  to  find  effective  ways  of 
interdepartmental  coordination;  to  see  how  the  ideas  of  staff 
experts  can  be  made  to  function  in  the  line  departments;  to 
see  how  the  several  staff  experts  can  work  in  harmony  and 
not  at  cross  purposes — can  work  with  prior  understanding  of  a 
common  aim. 

The  attempt  effectively  to  coordinate  the  staff  departments 
involves  a  study  of  organized  relationships  in  four  distinct  groups: 
Among  the  staff  heads;  among  the  line  heads  (foremen); 
within  each  staff  department;  and  among  the  manual  workers. 
The  problem  really  is  to  see  what  organization  is  desirable 
in  and  between  each  of  these  four  groups,  in  order  to  assure  that 
right  policies  are  adopted,  that  they  are  then  known  to  the  entire 
personnel  in  each  group,  and  finally  that  they  are  put  into  effect. 

Since  it  would  be  impossible  to  use  as  illustrations  of  our  con- 
clusions all  the  variations  in  executive  structure  which  exist, 
we  shall  confine  the  discussion  to  one  fairly  typical  organization 
scheme  from  which  application  to  other  executive  arrangements 
can  then  easily  be  made.  (See  Chart  IV.) 

The  Principle  Underlying  Sound  Coordination. — We  have  in 
other  chapters  advanced  the  principle  as  applicable  to  in- 
dustrial no  less  than  to  sound  political  government,  that  every 
special  interest  directly  affected  by  decisions  concerning  the  opera- 
tion of  any  enterprise  or  function  should  be  a  party  to  the  making  of 
those  decisions.  The  principle  is  immensely  relevant  to  this  dis- 
cussion because  it  seems  to  us  fundamentally  true  that  any 
policy  which  is  adopted  is  more  likely  to  be  a  reasonable  and 
wise  one  if  those  whom  it  affects  help  to  shape  it;  that  the  trans- 
mission of  policy  to  the  affected  parties  takes  place  most  naturally 

374 


COORDINATION  OF  STAFF  DEPARTMENTS 


375 


376  PERSONNEL  ADMINISTRATION 

when  those  parties  or  their  delegates  are  present  when  the  policy 
is  adopted,  know  its  implications  and  the  reasons  for  its  adoption, 
and  hence  can  interpret  it  to  their  fellows;  that  the  policy  when 
so  adopted,  so  transmitted  and  interpreted,  has  a  much  better 
chance  of  intelligent,  willing  and  thorough  execution,  than  if  it 
is  handed  down  as  a  fiat  from  the  management. 

Believing  that  this  conclusion  as  to  the  wisdom  of  the  repre- 
sentation of  special  interests  is  of  fundamental  importance  to 
sound  executive  action,  we  shall  proceed  in  this  chapter  to  in- 
dicate how  it  should  be  applied.  Those  who  feel  that  in  the 
coordinating  organizations  which  we  are  about  to  suggest,  the 
foremen  and  the  manual  workers  are  given  too  prominent  a  place, 
are  asked  to  remember  the  psychologically  close  relation  which 
scientific  observation  discloses  between  knowledge,  willing  eon- 
sent,  and  action.  They  are  further  asked  to  remember  that 
over-organization  may  at  times  be  necessary  in  order  to  assure 
the  explicit  recognition  of  functions  and  relationships — a  truth 
which  we  shall  later  amplify.  Moreover,  while  from  our  point 
of  view  it  would  be  most  inexpedient  and  unsafe  to  omit  the 
foremen  or  hand  workers  from  the  several  coordinating  bodies 
which  we  propose,  the  superficial  outline  of  the  plan  could 
be  retained  without  necessarily  retaining  foremen  and  workers 
on  every  committee.  Such  omission,  we  would  clearly  state 
however,  will  in  the  future  be  fraught  with  increasingly  great 
danger. 

The  Determination  of  General  Policy. — We  are  assuming 
here  that  the  Board  of  Directors  is  not  directly  active  in 
determining  any  but  the  most  general  policies  and  those  largely 
in  the  field  of  finance.  There  are,  however,  many  companies  in 
which  the  Board  passes  upon  such  matters  as  the  institution 
of  a  personnel  department,  the  establishing  of  a  shop  committee 
plan,  the  acceptance  of  collective  bargaining  and  the  like.  When 
the  Board  is  really  in  close  touch  with  plant  conditions  there  may 
be  warrant  for  taking  these  questions  of  operating  policy  to  it; 
but  in  general  a  sounder  decision  is  reached  if  such  matters  are 
considered  in  the  group  which  we  shall  presently  describe  as  the 
Operating  Committee. 

We  shall  further  assume  that  the  president  of  the  corporation 
is  at  the  same  time  a  member  ex-officio  of  the  board  of  directors 
and  the  executive  chief  of  the  factory  organization.  Immediately 
associated  with  him  there  will  be  four  major,  staff  executives— 


COORDINATION  OF  STAFF  DEPARTMENTS  377 

the  personnel  manager,  production  manager,  sales  manager  and 
financial  executive.  For  the  determination  of  general  operat- 
ing policy,  this  group  of  five  would  constitute  the  nucleus  of  an 
Operating  Committee. 

The  extent  to  which  additions  to  this  group  would  be  advisable, 
depends  on  the  size  of  the  plant,  the  character  of  the  product  and 
upon  the  desire  of  the  management  to  perfect  its  managerial 
technique  in  the  direction  of  that  representation  of  interests 
which  is  the  really  scientific  method  of  organization. 

If  it  is  wise  to  constitute  the  operating  committee  in  such 
a  way  that  the  values  of  coordinated  action  are  secured,  then  our 
proposal  that  in  addition  to  the  above  named  five  there  be  one 
representative  of  the  foremen  and  two  of  the  manual  workers 
will  be  sympathetically  understood.  The  operating  committee  is 
to  consider,  it  should  be  remembered,  all  questions  of  a  general 
nature,  especially  issues  which  affect  the  relation  of  one  staff 
department  to  another,  and  of  the  staff  to  the  line  departments. 
In  other  words,  it  is  making  decisions  that  affect  all  four  of  the 
groups  above  referred  to.  And  since  this  is  the  case,  the  reasons 
for  representing  all  four  groups  are  apparent.  They  all  learn 
of  contemplated  policies  before  they  are  adopted;  they  all 
have  a  chance  to  express  an  opinion  about  them  in  advance; 
they  all  help  to  decide  their  adoption ;  and  they  must  all  cooperate 
in  giving  them  effect.  By  securing  a  representation  of  the 
several  groups  in  the  coordinating  body  of  policy  determination 
the  threefold  problem  is  carried  a  long  way  toward  a  solution. 
For  this  body  not  alone  decides  policy;  its  members  transmit 
it  to  their  respective  groups,  and  secure  an  expression  of  their 
attitude.  The  execution  of  general  policies  which  are  favorably 
received  is  then,  of  course,  entrusted  t0  the  appropriate  ex- 
ecutive department. 

This  operating  committee  would  meet  at  least  weekly;  indeed 
in  some  plants  it  has  a  daily  morning  conference.  And  its  mem- 
bership, if  it  conforms  to  the  above  suggestions,  will  be  as  follows : 
-  The  Chief  Executive 

The  Production  Manager 

The  Personnel  Manager 

The  Sales  Manager 

The  Treasurer 

The  Foremen's  Representative 

The  Workers'  Representatives 


378  PERSONNEL  ADMINISTRATION 

Determination  of  Personnel  Policy. — As  already  pointed 
out,  some  companies  still  leave  to  the  board  of  directors  a  sur- 
prising degree  of  latitude  in  deciding  plant  policies.  If,  however, 
the  power  to  decide  is  to  be  vested  in  the  body  which  has  the 
knowledge,  the  operating  committee  would  usually  be  the  deciding 
body.  It  would  decide,  for  example,  in  the  first  instance  what 
powers  it  would  delegate  to  a  new  shop  committee;  and  having 
once  made  that  delegation  it  would  not  interfere  in  the  exercise 
of  that  authority  unless  it  had  good  reason  to  withdraw  the 
delegation  of  powers  altogether.  It  would,  to  take  another 
example,  decide  whether  or  not  to  enter  upon  a  collective  agree- 
ment and  on  the  general  terms  of  that  agreement;  but  it  would 
leave  to  individual  executives  the  work  of  actual  negotiation. 

Again,  if  joint  job  analysis  and  wage  rate  committees  as  de- 
scribed in  previous  chapters  are  authorized,  a  considerable 
degree  of  authority  can  wisely  be  delegated  to  them  in  their  re- 
spective fields  of  standardizing  work  and  pay.  In  short,  the 
operating  committee  would  either  itself  decide  upon  the  impor- 
tant personnel  policies,  or  it  would  decide  who  should  decide 
them. 

The  Personnel  Committee. — If  it  is  understood,  then,  that  be- 
yond the  determination  of  broad  policies  the  work  of  the  operat- 
ing committee  does  not  go,  there  is  need  for  a  body  in  each  of 
the  staff  branches  of  management  which  will  decide  how  their 
policy  shall  be  carried  out  and  will  acquaint  the  affected  groups 
with  proposed  new  methods. 

Policies  which  relate  to  personnel  should,  we  propose,  go  for 
decision  about  methods  of  execution  and  delegation  of  duties 
to  a  Personnel  Committee.  The  need  for  such  a  committee  is 
already  seen  in  a  number  of  plants  where  the  advantages  of 
"selling"  ideas  before  they  are  put  into  effect  are  clearly  under- 
stood. For  the  personnel  department's  work  is  peculiarly  in 
need  of  sympathetic  understanding  by  workers  and  foremen  if  its 
efforts  are  to  have  any  value.  And  there  is  in  any  organization 
where  personnel  work  is  to  be  effective,  need  of  a  liaison  body 
to  bring  together  the  production  and  personnel  managers,  tech- 
nical experts,  foremen  and  workers,  for  the  consideration  of 
personnel  procedure  and  methods.  Indeed,  the  educational  val- 
ues of  such  a  coordinating  group  are  great,  for  in  this  way  as  in 
no  other  foremen  and  workers  are  brought  "in  on  the  ground 
floor,"  whenever  new  personnel  questions  are  up. 


COORDINATION  OF  STAFF  DEPARTMENTS  379 

The  personnel  committee  is,  however,  primarily  advisory  to  the 
personnel  manager.  The  executive  responsibility  lies  clearly 
with  this  functionary. 

The  composition  of  such  a  personnel  committee  might  well 
be  as  follows: 

The  Personnel  Manager  (chairman) 

The  Production  Manager 

The  Assistant  Personnel  Manager 

The  Foremen's  Representative 

The  Workers'  Representatives 

This  committee  should  meet  at  least  weekly;  and  in  many 
plants,  in  which  it  is  already  established,  it  keeps  a  written 
record  of  its  decisions,  turning  over  to  the  personnel  depart- 
ment the  actual  administrative  work  mapped  out. 

Board  of  Personnel  Directors. — Within  each  staff  department 
lies  a  further  field  for  common  understanding  and  agreement 
upon  policy  and  procedure;  and  in  the  personnel  department  the 
need  for  a  united  stand  and  a  human  point  of  view  are  obvious. 
For  this  reason,  it  has  been  found  useful  in  most  personnel  de- 
partments comprising  more  than  two  or  three  workers  to  have 
a  definite  organization  within  the  department.  This  assures 
regular  conference  between  the  personnel  chief  and  his  executives 
on  employment,  health,  safety,  training,  research,  service  and 
joint  relations,  and  secures  the  benefit  of  the  interchange  of 
technical  ideas  and  of  the  wholesome  expert  criticism  of  depart- 
ment colleagues.  We  shall  refer  to  this  group  as  the  Board  of 
Personnel  Directors.  And  so  closely  does  the  work  of  this  board 
touch  upon  the  interests  of  foremen  and  workers,  that  there  is 
great  advantage  both  from  an  administrative  and  an  educational 
point  of  view,  in  having  representatives  of  these  two  groups  pres- 
ent. In  plants  where  there  is  an  employees'  association  which 
has  its  own  executive  secretary,  he  would  also  be  a  logical  member 
of  this  board. 

Some  personnel  managers  carry  this  idea  of  departmental 
organization  one  step  further  and  have  a  monthly  meeting  of 
the  entire  personnel  staff,  including  stenographers  and  messenger 
boys,  in  which  a  definitely  educational  purpose  is  held  in  view. 
The  potential  values  of  this  idea  are  great,  especially  when  the 
importance  of  cultivating  a  right  attitude  throughout  the  per- 
sonnel staff  is  understood. 


380  PERSONNEL  ADMINISTRATION 

Foremen's  Council. — But  the  work  of  executing  personnel 
policy  will  devolve  not  alone  upon  the  staff  of  the  personnel 
department.  There  will  be  many  personnel  problems  which 
closely  affect  the  foremen  and  will  depend  primarily  upon  them 
for  successful  execution.  It  is  for  this  reason  that  we  urge  that 
a  representative  of  the  foremen  be  on  the  operating  committee, 
on  the  personnel  committee  and  even  on  the  board  of  personnel 
directors.  And  in  their  relation  to  the  production  department 
there  will  be  other  bodies  on  which  the  foremen  can  profitably 
be  represented.  There  is,  therefore,  need  of  an  advisory  fore- 
men's body  to  give  expression  to  their  common  interests  and 
point  of  view. 

All  the  foremen  of  line  departments  should  constitute  a  fore- 
men's council;  or,  if  this  involves  the  creation  of  an  unwieldy 
body,  the  foremen  of  each  administrative  division  or  group  of 
related  departments  should  compose  a  foremen's  council.  This 
organization  should  then  have  as  one  of  its  major  functions  to 
consider  new  projects  which  the  operating  committee  or  some 
one  of  the  staff  departments  were  proposing  for  adoption.  Its 
work  would,  of  course,  be  advisory  in  this  connection;  but  it 
would  perform  the  indispensable  service  of  making  clear  through 
the  foremen's  delegates  to  the  several  committees  here  described, 
the  position  of  the  foremen  on  any  moot  question. 

Employee  Groups. — How  would  changes  in  personnel  policy 
be  taken  up  with  the  manual  workers?  We  have  already  pro- 
vided for  representation  of  the  workers  on  the  operating  com- 
mittee, and  personnel  committees  and  on  the  board  of  personnel 
directors.  And  where  there  is  a  shop  committee  or  employees' 
association,  the  presumption  is  that  the  employee  delegates  to 
the  managerial  committees  will  report  all  proceedings  and 
decisions  back  to  the  rest  of  the  employees. 

Where  no  employee  organizations  exist,  the  difficulty  of  estab- 
lishing any  interchange  of  views  is  obvious.  One  of  the  cogent 
reasons,  indeed,  for  such  organization  is  to  provide  an  agency 
through  which  this  important  work  of  transmitting,  interpreting 
and  carrying  out  policies  among  the  rank  and  file,  can  be  accom- 
plished. In  so  far  as  any  matters  of  policy  under  advisement 
relate  to  work  and  pay,  our  earlier  discussions  have  suggested 
representative  agencies  through  which  their  consideration  would 
normally  proceed. 

There  is,  in  short,  definite  need  of  an  organization  of  the  manual 


COORDINATION  OF  STAFF  DEPARTMENTS  381 

workers  with  whom  the  management  may  advise  about  policy; 
and  which  may,  if  joint  relations  have  progressed  that  far,  select 
delegates  who  can  undertake  the  actual  work  of  deciding  policies 
in  conference.  But  managements  should  be  constantly  alive 
to  the  danger  of  a  gulf  developing  between  employee  delegates 
and  the  workers  themselves.  The  delegates,  in  consequence 
of  the  educational  influences  of  their  committee  work  and  because 
of  the  closer  touch  with  all  the  facts  which  their  committee 
action  brings,  can  easily  grow  apart  from  those  they  represent. 

In  large  plants,  a  secret  ballot  referendum  on  questions  of  new 
policy  affecting  all  the  workers  will  often  be  the  safest  procedure. 

It  is  important  now  to  recapitulate  this  discussion — to  see 
just  what  its  suggestions  involve.  We  have  been  proposing 
that  once  the  broad  outlines  of  personnel  policy  are  determined 
upon,  their  application  must  be  considered  in  relation  to  four 
different  groups  in  the  factory  in  order  to  assure  their  wide 
understanding  and  ready  adoption.  Personnel  policy  must  be 
"sold"  to  the  operating  committee  at  the  top,  to  the  heads  of 
the  line  departments,  to  the  members  of  the  personnel  depart- 
ment and  to  the  manual  workers.  Hence  we  suggest  a  board  of 
personnel  directors  to  relate  the  personnel  department's  ad- 
ministrative work  to  that  of  the  other  administrative  and  advi- 
sory departments;  an  organized  relation  between  the  personnel 
department  and  the  foreman  group ;  a  formal  organization  within 
the  personnel  department  itself;  and  contacts  by  several  means 
with  groups  of  the  workers.  In  this  way  a  new  policy  never 
comes  to  any  group  as  a  surprise;  it  is  first  proposed,  then  dis- 
cussed, then  adopted — and  at  every  stage  the  affected  individuals 
are  brought  into  council. 

Determination  of  Production  Policies. — Because  production 
policies  so  often  affect  the  working  force  directly,  there  are  sound 
reasons  for  organizing  their  adoption  and  transmission  in  a 
manner  similar  to  that  just  considered  in  relation  to  the  personnel 
department.  This  would  mean  the  creation  of  a  committee, 
called  perhaps  the  Production  Committee,  composed  as  follows: 

The  Production  Manager  (chairman) 
The  Personnel  Manager 
The  Assistant  Production  Manager 
The  Foremen's  Representative 
The  Workers'  Representatives 


382  PERSONNEL  ADMINISTRATION 

And  where  special  problems  were  up,  such  other  executives  as 
the  head  of  the  planning  department,  the  chief  engineer,  the 
chief  chemist,  etc.,  would  be  called  in. 

It  is  the  function  of  this  committee  to  advise  with  the  produc- 
tion manager  about  methods  of  putting  new  production  policies 
into  effect — the  executive  power  remaining,  of  course,  with  the 
production  head. 

It  is  important  to  give  at  least  one  example  of  the  direction  in 
which  this  committee  would  work.  For  this  purpose  we  shall 
consider  the  function  of  planning  work. 

Many  plants  have  today  a  special  staff  department  (called 
variously,  planning  department,  methods  department,  efficiency 
department,  etc.)  to  which  is  assigned  the  function  of  studying 
to  map  out  and  improve  methods  of  production.  It  will  be  clear 
from  what  has  gone  before  that  this  work  of  planning  and  study 
should  benefit  by  the  advice  of  the  foremen,  of  the  personnel 
department  especially  on  its  research  side,  and  of  the  workers  to 
be  affected  by  proposed  changes.  None  of  the  planning  depart- 
ment's proposals  should  be  adopted  before  these  three  groups 
have  considered  and  approved  them.  And  since  on  the  produc- 
tion committee  these  several  groups  are  represented,  it  will 
be  desirable  to  have  the  production  committee  pass  on  the 
planning  department's  proposals.  Indeed  more  than  that  is 
needed. 

Experience  with  the  difficulties  that  planning  department 
work  has  encountered  in  the  past  leads  us  to  urge  with  confidence 
that  any  important  change  in  working  methods  which  affects 
most  of  the  shop  should  be  laid  by  the  planning  department  first 
before  the  executive  committee,  and  if  endorsed  by  it,  before  the 
foremen's  council  and  the  shop  committee  of  the  workers. 

There  should,  in  short,  be  an  organized  basis  for  agreement  on 
changes  in  process  between  staff  and  line  departments,  among 
line  departments,  and  with  workers.  And  any  organization 
which  ignores  this  problem  of  scientific  correlation  of  authority, 
knowledge  and  action,  is  bound  to  be  inefficient — if  not  because 
of  deliberate  malingering,  then  because  of  unnecessary  frictions 
and  maladjustments. 

The  Case  for  Over-Organization. — It  is  necessary  before 
proceeding  further  to  meet  any  possible  objection  to  such  "elabo- 
rate "  organization  in  the  contacts  between  staff  and  line  depart- 
ments and  between  process  and  personnel  departments,  as  we  are 


COORDINATION  OF  STAFF  DEPARTMENTS  383 

here  advocating.  Are  we  not  proposing  to  over-organize  the 
factory? 

Those  who  have  watched  the  installation  of  scientific  manage- 
ment systems  will  remember  that  it  usually  passes  through  an 
introductory  period  in  which  a  large  force  of  planning  and 
clerical  workers  is  needed.  Once  the  determination  of  methods, 
standard  practices  and  records  is  achieved  and  the  mechanism  is 
operating  smoothly,  the  staff  required  is  much  smaller.  But 
the  introduction  of  the  system  and  its  adequate  comprehension 
by  all  in  the  plant  is  made  easier  at  the  outset  by  having  every 
function  assumed  by  a  separate  person.  As  soon  as  the  number 
and  nature  of  the  functions  are  recognized,  it  becomes  possible 
to  consolidate  some  functions  and  redistribute  others. 

The  analogy  holds  measurably  true  regarding  the  initial 
over-organization  of  any  group  relationships.  The  first  condi- 
tion of  successful  coordination  is  to  see  distinctly  all  the  groups 
to  be  coordinated — all  the  points  of  view  which  have  to  be 
brought  into  working  harmony.  The  second  condition  is  to 
assure  in  some  way  that  those  groups  inter-act  consciously  and 
deliberately.  We  have  no  fondness  for  "committees"  as  such. 
We  are  not  even  urging  that  the  several  correlating  bodies  here 
proposed  are  necessarily  the  best  possible  or  are  composed  of  the 
right  functionaries.  But  if  any  plant  desires  to  provide  the 
machinery  under  which  proper  coordination  of  executive  acts 
takes  place,  we  believe  it  will  eventually  be  led  to  create  and 
utilize  conference  bodies  which  are  substantially  the  same  in 
character  and  composition  as  those  above  suggested. 

The  basic  principle  is  clear.  Essential  in  every  organization 
is  a  definitely  organized  understanding  between  those  who 
plan,  those  who  oversee  and  those  who  do  the  actual  work;  each 
group — if  the  organization  is  to  operate  smoothly — must  act 
with  the  full  knowledge  and  agreement  of  every  other  group. 
Intelligent  application  of  this  principle  in  any  given  plant  may 
not  be  easy;  but  it  is  only  the  principle  and  not  the  details  that 
we  are  urging  in  all  our  proposals.  And  we  hasten  to  add  our 
appreciation  of  the  fact  that  a  degree  of  organization  which,  for 
example,  is  imperative  in  a  plant  of  over  1000  employees  may  be 
exceedingly  cumbersome  in  a  smaller  organization. 

Even  in  relatively  small  plants,  however,  the  fault  with  the 
executive  staff  is  today  frequently  a  conspicuous  under-or- 
ganization.  And  this  means,  explicitly,  that  the  relation  of  the 


384  PERSONNEL  ADMINISTRATION 

several  executive  functions  to  each  other  is  not  recognized,  and 
that  the  reason  for  having  representative  counsel  on  executive 
decisions  is  not  appreciated. 

Moreover,  the  value  of  formal  conference,  even  with  other 
executives  with  whom  one  may  be  in  contact  forty  times  a 
day,  is  not  to  be  ignored.  For  formal  conference,  properly 
conducted,  gives  a  definiteness,  a  deliberateness,  a  sharpness  of 
outline  to  agreed  policies,  attainable  in  no  other  way. 

We  find,  therefore,  that  the  objection  of  over-organization  is 
one  that  really  need  not  be  a  serious  deterrent.  To  get  the  widest 
possible  agreement  to  a  course  of  action  before  it  is  undertaken 
is  the  one  best  way  of  assuring  that  the  action  will  be  put 
through.  Coordination  of  staff  departments  is  in  its  simplest 
terms  merely  the  effort  of  all  concerned  to  agree  in  advance  upon  a 
goal  and  upon  the  road  to  be  taken  to  reach  it.  And  it  is  true  here, 
as  it  is  of  so  much  factory  procedure,  that  what  may  seem  to  be 
the  longest  way  round  is  in  reality  the  shortest  way. 

Determination  of  Sales  Policy. — In  the  form  of  plant  organiza- 
tion which  this  chapter  assumes,  general  sales  policies  would  be 
decided  in  the  operating  committee.  How  drastic  a  proposal 
this  is,  may  not  be  at  first  appreciated ;  for  many  firms  are  still 
unconscious  of  the  extent  to  which  they  allow  the  sales  organiza- 
tion to  dictate  to  the  rest  of  the  management.  If  the  salesman 
can  get  the  orders,  it  has  formerly  been  true  that  the  shop  will 
be  turned  on  end  if  necessary  to  fill  them ;  if  he  cannot  get  them, 
the  rest  of  the  organization  sits  by  paralyzed. 

The  point  of  view  about  the  selling  policy  which  is  increasingly 
recognized  as  sound  is  at  almost  the  other  extreme  from  this.  The 
sales  force  is  being  called  upon  to  sell  what  the  production  force 
can  make.  And  this  certainly  comes  nearer  to  a  sensible  relation- 
ship of  sales  to  production  than  the  arrangement  now  so  fre- 
quently met. 

The  best  aim,  however,  is  to  get  executive  agreement  in  ad- 
vance through  the  operating  committee,  on  the  selling  policy 
to  be  followed.  The  ideal  is  that  no  staff  department  should  be 
in  supreme  control,  but  that  all  should  agree  on  general  policies 
in  the  entire  field  of  operation. 

It  is  probably  true,  at  least  for  the  present,  that  all  the  per- 
sonnel manager  can  do  to  oppose  a  sales  policy  which  spells 
irregular  work,  rush  orders,  overtime  work,  small-lot  orders, 
etc.,  is  to  use  his  influence  and  knowledge  in  the  operating  com- 


COORDINATION  OF  STAFF  DEPARTMENTS  385 

mittee.  But  this  will  be  a  valuable  educational  service  and  he 
will  soon  find  support  for  his  advocacy  of  regularized  produc- 
tion from  the  production  manager,  foremen  and  workers.  For 
it  will  soon  be  obvious  to  these  groups  that  on  all  such  matters 
as  changes  in  styles  and  specifications,  decisions  about  amounts 
of  finished  goods  to  be  kept  on  hand,  quality  and  amount  of 
goods  that  can  be  delivered  on  certain  dates,  these  groups  should 
be  consulted.  The  adoption  of  improved  sales  methods  will 
then  devolve  upon  the  selling  staff;  and  they  will  find,  as  our 
next  chapter  indicates,  an  appreciable  body  of  suggestive  experi- 
ence already  at  hand  to  help  in  devising  a  sales  policy  which 
regularizes  orders  and  demand. 

Determination  of  Financial  Policies. — Obviously  policies 
which  affect  the  balance  sheet  are  likely  to  work  back  and  in- 
fluence the  pay-roll — and  perhaps  other  elements  in  the  person- 
nel procedure.  Yet  until  recently  it  has  usually  been  considered 
that  the  financial  end  of  the  business  was  justifiably  a  law  unto 
itself,  answerable  for  its  decisions  only  to  those  "on  the  inside." 
A  change  in  this  attitude  is  now  discernible,  however,  due  to 
income  tax  and  corporation  tax  laws,  and  to  the  need  and  diffi- 
culty of  securing  additional  capital  unless  financial  policies  and 
conditions  are  known.  Moreover,  the  recent  extension  of  the 
shop  committee  movement  will  involve  in  an  increasing  number 
of  cases  the  consideration  of  fiscal  policies  with  employees. 

Companies  should  realize,  therefore,  how  intimately  connected 
with  personnel  matters  their  financial  problems  are.  And  even 
beyond  that,  managements  should  now  consider  the  benefits  in 
increased  knowledge,  confidence  and  sense  of  security,  which  a 
consideration  of  financial  policy  with  employees  is  tending  to 
bring. 

As  to  the  first  point,  corporations  may  be  prepared  to  admit 
that  the  fact  of  watered  stock,  large  undivided  surplus,  high 
depreciation  rate  and  large  dividends,  may  affect  the  management's 
attitude  toward  labor  issues.  But,  they  may  say,  "What  of  it?" 
,  Our  answer  is  that  the  reason  for  concern  is  that  not  only  the 
management's  attitude  is  affected,  but  that  of  the  workers  as 
well,  and  often  the  public's  attitude  also,  by  an  unsound  financial 
policy  or  condition.  A  large  New  England  corporation  was 
threatened  with  a  strike  in  several  of  its  plants  located  in  a  city 
where  "industrial  unrest"  was  becoming  so  chronic  as  to  have 
lost  the  public  attention  and  sympathy.  But  the  day  after  the 
25 


386  PERSONNEL  ADMINISTRATION 

strike  was  called,  the  corporation's  annual  report  was  issued  and 
carried  as  a  column  story  on  the  financial  page  of  all  the  papers. 
It  indicated  a  very  profitable  year  with  high  dividends  and  a 
large  surplus.  Of  course,  everyone,  worker  and  consumer  alike, 
who  saw  the  report,  drew  the  natural  conclusion  that  the  demand 
for  a  living  wage  was  a  wholly  reasonable  one.  And  from  that 
moment  the  company  had  lost  the  strike. 

This  is  only  a  graphic  example  of  what  is  happening  all  the 
time.  Each  day  the  newspapers  carry  financial  stories  and  ad- 
vertisements of  the  profit-making  ability  of  this  or  that  stock. 
The  workers,  or  the  workers'  representatives,  see  these  stories. 
And  having  no  other  knowledge  on  which  to  base  any  more  exact 
opinion,  they  necessarily  take  them  at  their  face  value,  draw 
their  own  conclusions  and  act  accordingly. 

Indeed,  even  if  a  corporation's  profit  and  loss  statement  does 
not  get  into  the  papers,  the  workers'  reaction  may  be  the  same  as 
when  they  see  such  a  statement.  For  they  tend  to  argue  from 
the  cases  they  know  to  their  own  company's  situation;  and  the 
fact  of  secrecy  in  the  corporation's  affairs  only  increases  the  sus- 
picion that  the  company  is  so  profitable  that  it  wouldn't  do  for 
the  management  to  mention  it.  The  fact  is  that  the  attitude  and 
conduct  of  workers  is  governed  by  the  information  they  can  glean ; 
and  if  they  have  only  half  the  financial  facts,  it  should  not  be 
surprising  if  their  subsequent  action  is  only  half  sound. 

It  may,  of  course,  be  urged  that  it  makes  no  difference  what  the 
workers  think;  that  the  profits  are  not  their  concern.  To  this 
there  are  two  answers.  First,  that  if  it  does  make  no  immediate 
outward  difference,  the  inward  difference,  the  difference  in  atti- 
tude, cannot  be  ignored.  Facts  about  profits  relate  themselves 
closely  and  basically  to  the  worker's  interest  in  his  work,  to  his 
interest  in  economy  of  operation,  to  his  sense  of  "company  loy- 
alty." If  he  feels  that  he  is  just  a  cog  in  a  machine  which  grinds 
out  wealth  for  others,  his  interest  declines  (or  is  never  stirred), 
any  possible  motive  for  economy  disappears  and  he  becomes  in- 
different to  claims  for  his  loyalty.  And  the  resulting  attitude, 
far  from  being  inconsequential,  is  in  reality  one  of  the  outstanding 
facts  and  causes  of  the  present  industrial  uneasiness.  In  short, 
the  time  has  passed  when  the  amount  of  a  firm's  profits  can  be 
considered  as  a  matter  of  no  proper  concern  to  either  workers  or 
consumers. 

In  the  second  place,  the  fact  that  the  amount  of  profit  does 


COORDINATION  OF  STAFF  DEPARTMENTS  387 

have  some  relation  to  the  labor  problem  is  already  admitted  by 
those  firms  which  adopt  any  type  of  profit  sharing  or  stock  pur- 
chase plan.  In  these  cases  the  corporations  have  virtually  said, 
"Our  profits  are  made  with  the  help  of  the  workers;  and  we  shall 
therefore  reimburse  them  in  whole  or  in  part  for  their  share  in 
the  result."  And  it  is  significant  to  note  that  where  these  plans — 
especially  profit  sharing — are  in  use,  the  company  usually  finds 
it  wise  to  adopt  also  some  fixed  policy  by  which  it  can  make  plain 
to  its  employees,  facts  regarding  amounts  of  outstanding  stock, 
size  of  depreciation  funds,  reserves,  surplus,  and  methods  of  com- 
puting "fixed  charges"  and  "net  income." 

What  is  true  regarding  the  desirability  of  the  dissemination  of 
knowledge  about  financial  affairs  in  profit  sharing  companies,  is 
becoming  increasingly  true  in  non-profit  sharing  firms.  The  time 
has  come  when  it  is  safest  to  have  these  policies  of  a  character 
which  it  is  not  too  difficult  to  justify  to  employees  and  consumers, 
if  an  hour  arrives  when  justification  is  necessary.  And  such  an 
hour  has  already  come  in  corporations  where  shop  committees  or 
labor  unions  are  pressing  for  wage  advances  or  for  information 
about  operating  costs,  as  well  as  where  profit  sharing  is  in  effect. 

It  is  a  great  mistake  to  think  that  industrial  affairs  can  be 
neatly  divided  into  those  questions  which  concern  workers  and 
those  which  concern  management.  No  absolute  line  of  demarca- 
tion exists.  The  price  of  raw  material  and  its  quality,  the  amount 
of  it  which  shall  be  carried  in  stock,  advertising  and  selling  poli- 
cies and  the  amount  of  finished  goods  to  be  carried  in  stock — 
these  matters  not  only  have  their  result  on  the  ultimate  outcome 
of  the  year's  profits,  but  they  may  also  mean  the  difference  be- 
tween bankruptcy  and  solvency,  between  a  regular  flow  of  work 
and  constant  interruptions,  between  a  condition  where  the  material 
is  easily  worked  and  where  the  amount  of  "botheration"  is 
annoying  and  fatiguing  to  the  worker.  Obvious  as  all  this 
seems  the  conclusion  to  be  drawn  from  it  has  not  thus  far  been  so 
obvious.  But  an  increasing  number  of  managers  are  coming  to 
see  that  employees'  interest  in  financial  policies  is  not  something 
to  be  feared  but  something  to  be  welcomed  because  of  the  better 
coordination  in  all  the  above  directions  which  it  promises. 

This,  then,  is  the  second  reason  for  urging  consideration  of  the 
relation  of  financial  to  personnel  issues.  Illustrations  are  plenti- 
fully at  hand  to  show  that  where  managements  have  taken 
workers  fully,  freely  and  sincerely  into  their  confidence  on 


388  PERSONNEL  ADMINISTRATION 

financial  matters  the  results  have  been  mutually  satisfactory. 
"It  is  a  policy  of  the  executives  of  the  Greenfield  Tap  and  Die 
Corporation,"  says  one  of  its  officials,  "to  discuss  with  their 
employees  frankly  and  openly  business  prospects  and  policies 
on  an  occasion  when  a  large  group  of  employees  is  assembled 
together.  The  connection  between  general  business  and  a 
man's  own  industry  and  prosperity  can  be  put  to  a  group  of 
employees  ...  in  elementary  basic  terms  ...  I  believe  that 
every  employer  should  stand  ready  at  critical  times  to  analyze 
with  his  men  in  this  way  the  relation  of  their  particular  company 
with  world  trade  .  .  .  This  policy  .  .  .  prepares  for  unavoid- 
able troubles.  It  smooths  away  unnecessary  anxiety  of  the 
men.  It  tends  to  get  cooperation.  If  there  were  a  wider  under- 
standing of  the  function  of  money  and  finance  there  would  be  less 
unrest,  less  exaggerated  notions  of  the  freedom  that  the  head  of  a 
business  is  supposed  to  have  from  surrounding  restraints."1 
Another  company  called  its  shop  committee  together  soon 
after  the  armistice  and  made  a  statement  which  is  in  part  as 
follows : 

"A  condition  of  business  depression  has  been  brought  about  by  a 
very  decided  falling  oft  in  orders,  due  to  two  principal  reasons.  First 
of  all  our  business  is  divided  between  export  and  import,  a  greater  quan- 
tity being  export.  Domestic  business  has  dropped  off  because  every- 
body is  anticipating  a  decline  in  prices,  etc.,  etc. 

"The  big  proposition  that  confronts  the  company  at  this  time  is  the 
conservation  of  capital  in  not  piling  into  the  finished  stock  room  dollars 
worth  of  stuff  that  cannot  be  used.  The  other  proposition  is  turning 
into  cash  those  things  that  are  in  the  finished  stock  room,  because  for 
every  $100  worth  that  lie  there  one  day,  the  company  loses  six  and  two- 
third  cents."8 

It  is  interesting  to  contrast  this  policy  with  that  of  a  company 
where  one  worker  said,  "Every  morning  you  went  there,  you 
were  never  sure  but  what  you  were  the  next  one  to  be  laid  off." 

Another  company  whose  business  was  affected  by  the  armistice 
took  its  shop  committee  into  conference  to  advise  it  as  to  ways 
of  meeting  the  situation.  Among  other  things  the  company 
found  that  the  rate  of  production  had  slowed  down  considerably 

1  PAYN«,  FREDERICK  H.  Talking  Finance  to  Employees,  Industrial 
Management,  July,  1919. 

f  WOLK,  DAUB.  Successful  Industrial  Democracy,  Imlwttrial  Manage- 
ment, July,  1919. 


COORDINATION  OF  STAFF  DEPARTMENTS  389 

because  everyone  feared  a  lay-off.  Early  in  1919  orders  began 
to  increase,  and  communication  of  this  fact  to  the  workers  at 
once  brought  a  resumption  of  the  normal  working  pace. 

There  is  one  final  aspect  of  the  relation  of  finance  to  personnel, 
which  is  destined  to  assume  importance  as  time  goes  on.  In 
August,  1919,  the  railroad  brotherhoods  issued  a  statement 
regarding  their  proposal  for  the  operation  of  the  railroads,  which 
contained  this  sentence :  "  We  demand  that  the  owners  of  capital, 
who  represent  only  financial  interest  as  distinguished  from  operat- 
ing brains  and  energy,  be  relieved  from  management,  receiving 
Government  bonds  with  a  fixed  interest  return  for  every  honest 
dollar  that  they  have  invested."1 

This  demand  strikes  a  new  note  in  American  labor  declara- 
tions; and  is  of  significance  for  us  because  it  shows  a  large  body 
of  workers  definitely  stating  that  they  view  with  apprehension 
the  too-complete  control  of  industry  by  the  "owners  of  capital." 
It  would  be  a  mistake  to  say  that  this  attitude  is  general  through- 
out the  working  class ;  but  it  reenf orces  our  earlier  statement  that 
the  importance  of  being  able  to  justify  financial  policy  is  a  real 
and  growing  one.  Workers  in  all  the  basic  industries — trans- 
portation, coal-mining,  iron  and  steel  manufacture,  textiles — 
are  beginning  to  go  "behind  the  returns."  This  is  a  fact  in 
which  managers  may  see  grave  dangers;  but  it  is  none  the 
less  true,  as  some  companies  have  already  demonstrated,  that 
workers'  interest  in  the  finances  can  be  made  the  occasion  for 
securing  a  cooperation  in  economical  production  which  it  will  be 
impossible  to  achieve  in  any  other  way. 

Adequate  Coordination. — Our  conclusion  from  this  survey 
of  the  relation  between  the  different  staff  groups  is  simple  but 
exceedingly  far-reaching:  All  general  policies  should  be  decided, 
not  by  the  staff  department  which  later  executes  them,  but  by  the 
group  of  staff  heads  whose  primary  job  is  to  secure  balance  and 
harmony  in  the  management  of  the  organization.  Adoption  of  this 
policy  will  embody  one  of  the  bed-rock  principles  of  sound 
organization. 

For  sound  organization,  it  is  well  to  remember,  is  net  without 
its  definite  principles.  It  does  not  grow  spontaneously;  it 
develops  only  as  certain  broad  rules  are  adhered  to.  And  the 
task  of  coordination — at  the  top  and  at  the  bottom  of  the  organi- 
zation— will  be  greatly  simplified  if  those  rules  are  in  effect.  It 

1  New  York  Times,  August  5,  1919. 


390  PERSONNEL  ADMINISTRATION 

will,  therefore,  be  useful  in  conclusion  to  state  briefly  those 
principles  of  executive  action  which  apply  both  in  the  man- 
agement of  a  whole  enterprise  and  within  each  single  staff 
department. 

Principles  of  Sound  Executive  Organization. — The  work  of 
each  executive  will  be  clearly  set  forth  in  writing — an  executive's 
job  analysis.  This  statement  will  make  plain  the  limits  of  his 
authority  and  responsibilities.  And  it  will  show  to  whom  he 
reports. 

The  work  of  the  executive  is  to  plan,  organize,  delegate  and 
supervise.  He  is  responsible  for  seeing  that  all  the  details  of 
the  work  for  which  he  is  responsible  are  delegated  to  some  one. 

The  executive  is  in  touch  with  the  work  of  those  under  him 
through  the  use  of  those  summarized  records  which  are  necessary 
to  give  him  a  grasp  of  the  crucial  problems  and  large  results. 
He  will  decide  which  records  it  is  important  for  him  to  see; 
and  will  keep  these  at  a  minimum.  He  will  be  presented  with 
full  details  only  when  these  are  necessary  to  help  him  in  forming 
decisions.  He  will  also  keep  a  permanent  record  of  his  own 
important  decisions. 

Records  of  executive  policy  and  executive  accomplishment 
should  be  currently  available.  Too  much  time  is  spent  in 
every  organization  by  executives  in  "picking  up  the  threads," 
in  explaining  to  subordinate  executives  policies  which  have 
presumably  been  in  force  for  some  time,  in  trying  out  again 
mistaken  methods,  of  which  a  second  trial  is  quite  unnecessary. 

The  executive  in  delegating  responsibility  will  make  as  specific 
a  statement  as  possible  of  the  work  to  be  done.  He  will  a/.so 
delegate  all  the  authority  necessary  for  the  proper  performance  of  the 
work. 

The  executive  will  have  the  duties  of  his  subordinates  clearly 
set  forth  in  writing.  Each  one  will  be  responsible  for  certain 
specific  duties.  Every  duty  will  then  surely  have  some  one 
person  who  is  responsible  for  it. 

The  executive  will  see  to  it  that  no  man  is  indispensable 
to  the  organization.  This  is  meant  only  in  the  sense  that  each 
executive  position  should  be  adequately  understudied. 

The  executive  will  see  that  ench  individual  is  allowed  to  func- 
tion so  far  as  possible  in  the  field  where  he  is  qualified  and 
interested.  It  is  less  important  to  have  a  neat  and  logical  or- 
ganization chart  in  the  office,  than  to  have  all  the  necessary 
functions  distributed  so  that  they  may  be  performed  effectively. 


COORDINATION  OF  STAFF  DEPARTMENTS  391 

The  executive  will  allow  the  understudies  sufficient  chance  to 
exercise  responsibility  and  make  decisions  to  be  sure  that  they 
can  "take  the  reins"  and  that  they  will  do  it  wisely. 

The  executive  will  see  to  it  that  no  man  is  expected  to  do  more 
in  a  day  or  week  than  can  reasonably  be  done. 

The  executive  will  give  full  credit  to  others  for  results  achieved 
by  them.  He  will  lead  and  not  drive;  he  will  challenge  and 
stimulate  ability  by  giving  it  a  chance;  he  will  foster  it  by  giving 
it  recognition  when  it  is  displayed. 

Administrative  machinery  is  good,  it  has  been  wisely  sum- 
marized, "when  the  proper  tests  are  prescribed  for  the 
qualifications  of  officers,  the  proper  rules  for  their  promotion; 
when  the  business  is  conveniently  distributed  among  those 
who  are  to  transact  it,  a  convenient  and  methodical  order 
established  for  its  transaction,  a  correct  and  intelligible  record 
kept  of  it  after  being  transacted;  when  each  individual  knows 
for  what  he  is  responsible,  and  is  known  to  others  as  responsible 
for  it;  when  the  best-contrived  checks  are  provided  against 
negligence,  favoritism,  or  jobbery  in  any  of  the  acts  of  the 
department."1 

Charts  of  Coordination. — Organization  charts  can  serve  a 
useful  purpose  in  keeping  everyone's  thinking  straight  about  the 
correlation  of  functions.  But  confusion  will  be  avoided  if  it  is 
recognized  that  charts  are  of  three  distinct  types  to  convey  three 
different  kinds  of  information.  And  until  all  three  are  under- 
stood, the  whole  story  of  the  distribution  of  executive  work  and 
authority  is  not  apparent. 

There  is,  first,  the  authority  chart,  which  shows  the  line  of 
authority,  of  policy  determination  and  execution. 

There  is,  second,  the  chart  of  functions,  which  shows  what 
functions  each  department  is  supposed  to  perform. 

And,  third,  there  is  the  personnel  chart,  which  shows  how  the 
several  functions  are  distributed  among  the  executives.  Usually, 
the  first  chart  can  be  combined  with  the  third  to  show  the  line 
of  authority  in  terms  of  those  who  exercise  it. 

To  help  make  graphic  the  proposals  of  this  chapter,  we  have 
included  as  Chart  IV  our  general  conception  of  the  interrelation 
of  the  different  functional  groups  of  the  personnel  and  production 
departments.  To  keep  the  chart  as  simple  as  possible  we  have 
not  shown  how  these  two  departments  might  be  coordinated  with 
sales  and  finance;  nor  have  we  included  any  relationship  to  out- 
J.  S.,  Considerations  on  Representative  Government,  Chapter  II. 


392  PERSONNEL  ADMINISTRATION 

side  bodies  such  as  would  be  entailed  if  a  collective  bargain  existed 
with  a  labor  union. 

Administrative  Problems  of  a  Holding  Corporation. — There 
is  a  final  aspect  of  the  problem  of  administrative  correlation 
which  requires  separate  consideration,  as  a  problem  of  growing 
prevalence.  We  refer  to  the  correlation  of  the  central  office  and 
the  factory  office  in  a  holding  or  operating  corporation  which 
controls  a  number  of  plants. 

It  is  a  fairly  well  established  conclusion  that  such  central 
organizations  will  not  wisely  hold  in  the  central  office  the  deter- 
mination of  distinctly  local  policies  and  the  administration  of 
local  practices.  The  right  principle,  difficult  though  its  appli- 
cation in  any  given  case  may  be,  is  to  let  the  central  group 
determine  policies  concerning  which  uniformity  among  the  units 
M  essential,  but  beyond  that  to  leave  wide  discretion  to  the  local 
plant  management. 

Even  so  the  decisions  of  the  central  office  should  be  reached 
only  after  discussion  among  those  involved.  The  principle  of  the 
representation  of  every  special  interest  in  decisions  which  affect 
them  should  apply  here  as  elsewhere.  Specifically  this  means 
that  the  respective  plant  managers  of  an  operating  company 
should  form  the  nucleus  of  the  directive  group  of  the  parent 
company. 

Often,  of  course,  these  parent  companies  construe  their  func- 
tion as  that  of  "service"  agencies  for  the  smaller  units.  In  all 
such  cases  the  relation  of  the  staff  experts — cost,  finance,  pro- 
duction, research,  personnel  experts — to  the  respective  depart- 
ments of  the  several  plants  becomes  atonce  a  problem.  Suppose, 
for  example,  the  parent  company  has  a  manager  of  industrial 
relations;  what  shall  be  his  relation  to  the  personnel  administra- 
tor of  each  plant?  Broadly  speaking,  his  relation  should 
probably  be  in  part  administrative  and  in  part  advisory.  It 
will  be  useful  to  have  uniformity  among  the  plants  as  to  certain 
forms,  records  and  standards  of  terms  of  employment;  although 
the  achieving  of  this  uniformity  by  a  mere  fiat  would  be  a  rather 
unwholesome  way  of  getting  results.  But  on  many  lesser 
questions,  it  will  be  important  for  the  staff  expert  to  "sell" 
his  ideas  by  persuasion  and  conviction  rather  than  force  their 
adoption  by  an  exercise  of  authority. 

This  principle  should  apply  in  every  staff  branch  of  manage- 
ment, and  for  the  reason  that  the  local  administration  can  only 
function  in  accordance  with  the  staff's  advice  if  it  knows  why 


COORDINATION  OF  STAFF  DEPARTMENTS  393 

it  does  what  it  does,  and  believes  that  in  following  such  advice 
it  is  doing  a  good  thing. 

The  tendency  in  industry  is  definitely  toward  the  operation  of 
a  number  of  plants  under  one  management.  In  such  consolida- 
tions, a  period  of  highly  centralized  control  has  usually  been 
followed  by  a  gradual  decentralizing  of  control  and  authority  to 
the  local  manager.  This  transition  appears  to  be  not  only 
inevitable  but  sound;  and  the  sooner  it  is  effected  the  better. 
The  central  staff  group  has  the  expert  knowledge  and  broad 
outlook  to  make  its  advice  invaluable.  But  in  action  the  local 
group  must  determine  methods  and  apply  with  flexibility  the 
policies  agreed  upon.  The  ideal  balance  to  be  sought  is  one 
which  harmonizes  the  freedom  of  action  and  initiative  of  each 
local  plant  with  that  degree  of  uniformity  among  all  which  proves 
to  make  for  efficiency  and  economy  in  the  operation  of  the  entire 
corporation. 

Two  of  the  foremost  students  of  government  in  the  last 
century  have  analyzed  the  problem  of  centralization  in  terms 
which  are  so  completely  applicable  to  the  relation  of  the  holding 
company  to  its  constituent  plants,  that  they  merit  thoughtful 
study.  Indeed,  they  have  given  classic  expression  to  what 
appear  to  us  to  be  the  fundamentals  of  this  subject. 

"Centralization,"  said  De  Tocqueville,  "easily  succeeds, 
indeed,  in  subjecting  the  external  actions  of  men  to  a  certain 
uniformity,  which  we  come  at  last  to  love  for  its  own  sake, 
independently  of  the  objects  to  which  it  is  applied,  like  those 
devotees  who  worship  the  statue,  and  forget  the  deity  it  repre- 
sents. Centralization  imparts  without  difficulty  an  admirable 
regularity  to  the  routine  of  business;  provides  skillfully  for  the 
details  of  the  social  police;  represses  small  disorders  and  petty 
misdemeanors;  maintains  society  in  a  status  quo  alike  secure  from 
improvement  and  decline ;  and  perpetuates  a  drowsy  regularity  in 
the  conduct  of  affairs,  which  the  heads  of  the  administration 
are  wont  to  call  good  order  and  public  tranquillity;  in  short,  it 
excels  in  prevention,  but  not  in  action.  Its  force  deserts  it, 
when  society  is  to  be  profoundly  moved,  or  accelerated  in  its 
course;  and  if  once  the  co-operation  of  private  citizens  is 
necessary  to  the  furtherance  of  its  measures,  the  secret  of  its 
impotence  is  disclosed.  Even  whilst  the  centralized  power,  in 
its  despair,  invokes  the  assistance  of  the  citizens,  it  says  to  them : 
'You  shall  act  as  I  please,  as  much  as  I  please,  and  in  the  direc- 
tion which  I  please.  You  are  to  take  charge  of  the  details, 


394  PERSONNEL  ADMINISTRATION 

without  aspiring  to  guide  the  system;  you  are  to  work  in  darkness; 
and  afterwards  you  may  judge  my  work  by  its  results.'  These 
are  not  the  conditions  on  which  the  alliance  of  the  human  will 
is  to  be  obtained;  it  must  be  free  in  its  gait,  and  responsible 
for  its  acts,  or  (such  is  the  constitution  of  man)  the  citizen  had 
rather  remain  a  passive  spectator,  than  a  dependent  actor,  in 
schemes  with  which  he  is  unacquainted."1 

And  John  Stuart  Mill  supplements  this  observation  with  the 
following  statement  of  a  positive  principle: 

"The  authority  which  is  most  conversant  with  principles 
should  be  supreme  over  principles,  while  that  which  is  most 
competent  in  details  should  have  the  details  left  to  it.  The 
principal  business  of  the  central  authority  should  be  to  give 
instruction,  of  the  local  authority  to  apply  it.  Power  may  be 
localized,  but  knowledge,  to  be  most  useful,  must  be  central- 
ized; there  must  be  somewhere  a  focus  at  which  all  its  scattered 
rays  are  collected,  that  the  broken  and  coloured  lights  which 
exist  elsewhere  may  find  what  is  necessary  to  complete  and 
purify  them.  To  every  branch  of  local  administration  which 
affects  the  general  interest,  there  should  be  a  corresponding 
central  organ,  either  a  minister,  or  some  specially  appointed 
functionary  under  him;  even  if  that  functionary  does  no  more 
than  collect  information  from  all  quarters,  and  bring  the  ex- 
perience acquired  in  one  locality  to  the  knowledge  of  another 
where  it  is  wanted.  But  there  is  also  something  more  than 
this  for  the  central  authority  to  do.  It  ought  to  keep  open  a 
perpetual  communication  with  the  localities — informing  itself  by 
their  experience,  and  them  by  its  own;  giving  advice  freely 
when  asked,  volunteering  it  when  seen  to  be  required;  compel- 
ling publicity  and  recordation  of  proceedings,  and  enforcing 
obedience  to  every  general  law  which  the  legislature  has  laid 
down  on  the  subject  of  local  management."8 

The  phrase,  power  must  be  localized,  should,  as  the  key  to  the 
successful  administration  of  a  large  operating  company,  be 
framed  for  all  the  officials  of  such  companies.  And  the  phrase, 
knowledge  must  be  centralized,  should  be  continually  impressed 
upon  all  local  managers.  With  this  interaction  of  forces,  results 
promise  to  be  the  best.  Yet  the  problem  is  after  all  more  com- 

1  TOCQUEVILLE,  ALEXIS  DE,  Democracy  in  America,  v.  1,  pp.  113-114. 
Botton,  ed.,  1876. 

1  Considerations  on  Representative  Government,  Chapter  XV. 


COORDINATION  OF  STAFF  DEPARTMENTS  395 

plex  than  we  have  yet  intimated.  And  it  is  not  really  faced  in 
any  corporation  till  the  executives  soberly  ask  themselves 
how  many  plants  and  what  number  of  employees  can  be 
effectively  brought  under  one  directive  organization  in  a 
given  industry.  Upon  this  question,  there  appears  to  be  room 
for  significant  experiment.  For  certainly  the  conclusion  seems 
to  be  inescapable  today,  that  some  plants  are  too  large  for 
proper  management  and  that  some  operating  companies  have  too 
many  units  to  assure  the  fullest  effective  use  of  the  central 
staff  by  each  local  plant.  That  there  is  a  right  size  for  plants 
and  corporations  in  each  industry  seems  a  probable  hypothesis. 
And  it  certainly  is  clear  that  administrative  correlation  is  well- 
nigh  impossible  in  organizations  which  have  grown  without 
giving  any  thought  to  what  is  for  them  the  efficient  size. 

Conclusion. — It  is  clearly  necessary  to  provide  in  each  organ- 
ization that  the  several  staff  departments  in  relation  to  each 
other  and  to  the  line  departments,  supplement  each  other  rather 
than  work  at  cross  purposes.  Only  so  can  intelligent,  unified 
and  balanced  executive  action  be  secured. 

Personnel  and  other  staff  managers  are  looking  at  the  same 
problem  of  applying  labor  to  material  to  transform  it  into  useful 
objects,  from  different  but  equally  indispensable  points  of  view. 
And  successful  management  means  that  at  all  times  and  on  all 
significant  executive  decisions,  these  points  of  view  have  been 
harmonized  or  at  least  brought  to  a  practical  working  adjustment. 
What  degree  of  coordination  there  should  be  beyond  this  point 
in  order  to  secure  a  regularized  production  and  steady  work, 
we  shall  consider  in  the  next  chapter. 

Selected  References 

ALFORD,  L.  P.     Evolutionary  Business  Principles.     (In  Industrial  Manage- 
ment, v.  56,  pp.  8-9,  July,  1918.) 
CHURCHILL,  W.  L.     On  What  Should  Profits  be  Based?     (In  Industrial 

Management,  v.  58,  pp.  375-380,  Nov.,  1919.) 
GANTT,  H.  L.     Organizing  for  Work.     N.  Y.,  Harcourt,  Brace  &  Howe, 

1919. 
KIMBALL,    H.    W.     Educating    the    Workers   to    Sound    Economics.     (In 

Industrial  Management,  v.  58,  pp.  414—416,  Nov.,  1919.) 
RUST,    E.    G.     Centralization   versus    Decentralization   in    Management. 

Annals,  Amer.  Acad.,  v.  85,  pp.  100-109,  Sept.,  1919. 
WARNE,  F.  J.     Corporation  Finance  and  the  Worker.     (In  Annals,  Am. 

Acad.,  v.  85,  pp.  271-278,  Sept.,  1919.) 
WEINSTOCK,   LUBIN  &  Co.,  SACRAMENTO,  CAL.     The  New  Organization. 

Pamphlet,  1919. 


CHAPTER  XXVII 
STEADY  WORK 

"The  most  outstanding  failure  in  our  industrial  system — 
affecting  alike  the  interests  of  the  employer  and  the  employe," 
says  one  of  America's  foremost  industrial  engineers,  "is  the 
tremendous  amount  of  intermittency  of  employment  and  actual 
unemployment.  If  the  individual  manufacturer  or  a  given 
industry  is  going  to  take  up  personnel  work,  this  is  certainly  the 
place  to  start,  for  thousands  of  employers  have  learned  how  to 
give  steady  employment  in  season  and  out  of  season,  in  good 
and  bad  times.  Unemployment  and  its  twin  sister  intermittency 
are  certainly  not  acts  of  God,  but  usually  due  to  bad  manage- 
ment, or  rather,  due  to  the  absence  of  forethought  and  planning.1" 

Again  and  again  throughout  this  study  we  have  been  faced 
with  the  importance  to  the  worker  of  having  some  assurance 
of  regular  employment.  It  should  not  be  necessary  to  urge  the 
importance  of  regularized  production  to  the  management,  since 
obviously  if  the  plant  could  run  300  days  every  year  the  amount 
produced  and  its  value,  other  things  being  equal,  would  be  com- 
mensurately  larger  than  is  now  the  case.  It  is,  nevertheless,  a 
matter  for  remark  that  so  many  plants  have  been  willing  to  rest 
content  with  an  irregular  flow  of  work,  due  to  whatever  reason; 
and  have  not  always  shown  an  affirmative  determination  to 
keep  running. 

In  all  probability,  however,  the  extension  of  personnel  manage- 
ment will  tend  to  quicken  interest  in  regularaation ;  since,  even  if 
buildings  and  machinery  can  stand  without  working,  the  workers 
themselves  are  all  the  time  directly  dependent  upon  their  efforts 
for  their  week  to  week  sustenance.  So  true  is  this  and  so  funda- 
mental a  fact  is  it,  that  it  can  be  laid  down  as  an  axiom  of  sound 
management  that  no  organization  has  really  solved  its  problem 
of  securing  the  interest,  loyalty  and  enthusiasm  of  its  members 
unless  it  is  assuring  them  work  (or  some  compensation  in  its 
absence)  the  year  round. 

1  COOKE,  M.  L.  An  All- American  Basis  for  Industry,  Philadelphia, 
1919,  p.  3. 

396 


STEADY  WORK  397 

This  truth  has  not  gone  unrecognized,  and  in  the  last  few  years, 
due  largely  to  the  insistence  of  personnel  executives,  a  number  of 
plants  have  undertaken  to  regularize  employment.  No  dis- 
cussion of  methods  gets  beyond  the  elementary  stages,  however, 
which  does  not  distinguish  the  several  causes  of  irregular  work. 
There  are  four  large  groups  of  causes,  and  attention  to  only  one 
will  naturally  not  complete  the  solution.  Causes  of  irregularity 
lie  in  individual  deficiencies,  poor  factory  organization  and  co- 
ordination, seasonal  employment,  and  industrial  depressions. 
While  it  will  be  useful  here  to  get  a  broad  idea  of  the  entire  prob- 
lem we  shall  consider  at  greatest  length  the  second  and  third 
causes — factory  maladjustments  and  seasonal  fluctuations. 

Individual  Maladjustments. — Irregularities  of  work  which  are 
due  to  the  individual  may  be  found  when  the  worker  is  a  normal 
individual  and  when  he  is  in  some  way  deficient.  To  the  extent 
that  he  is  normal,  it  is  presumably  one  of  the  primary  tasks  of  the 
personnel  department  to  secure  his  proper  selection  and  adapta- 
tion to  the  organization — a  problem  which  we  have  already 
considered.  There  is  no  denying  that  lack  of  such  proper  ad- 
justment has  contributed  to  making  even  normal  individuals 
uneasy  and  inconsecutive  at  work.  'And  this  is  a  cause  of  irregu- 
larity in  attendance  today  which  is  a  price  industry  must  pay 
for  its  omissions  of  the  past. 

Where,  however,  the  cause  is  more  definitely  pathological  the 
remedy  beyond  the  initial  detection  of  an  abnormal  condition 
is  not  at  hand  within  the  individual  plant.  By  improved  selection 
methods  it  will  be  possible  and  essential  to  identify:  The  feeble- 
minded— and  to  a  certain  extent  find  work  adapted  to  their 
powers;  the  epileptics — and  perhaps  find  work  for  the  milder 
cases  at  which  the  hazard  to  them  and  their  fellows  is  negli- 
gible; the  paranoiacs,  those  who  are  victims  of  recurring 
obsessions,  delusions  or  fits  of  melancholy;  those  with  a  chronic 
wanderlust  and  complete  absoncc  of  powers  of  application;  and 
the  chronic  inebriates.  But  while  individual  factories  can  and 
should  help  by  identifying  such  unfortunates,  the  major  respon- 
sibility for  their  protection  and  custody  rests  upon  the  community ; 
and  the  provision  of  community  agencies  for  the  segregation  of 
the  more  acute  cases  is  the  only  safe  and  humane  procedure. 

Factory  Maladjustments. — It  will  be  hard  to  distinguish  at 
all  times  those  causes  of  irregular  work  which  are  due  to  lack 
of  orders  from  those  due  to  seasonal  demands.  Without  trying 


398  PERSONNEL  ADMINISTRATION 

to  draw  any  hard  and  fast  line  we  shall  therefore  consider  meth- 
ods of  regularizing  production  from  the  point  of  view  of  the  dif- 
ferent administrative  departments;  since  upon  each  of  them 
devolves  certain  responsibilities  for  its  achievement. 

Personnel  Procedure. — In  addition  to  all  its  efforts  to  assure 
that  the  workers  are  fitted  for  and  like  their  work,  the  personnel 
department  will  have  at  least  two  special  concerns  in  its  cam- 
paign to  regularize  employment.  It  will  see  to  it,  first,  that  there 
is  no  lay-off  in  any  department  before  the  personnel  manager  is 
notified.  Since  "a  good  rule  works  both  ways,"  it  will  be  wise 
to  urge  workers  to  give  notice  of  leaving  a  week  ahead,  and  to 
have  a  definite  rule  that  no  one  will  be  laid  off  without  at  least  a 
week 's  notice — and  two  weeks  would  be  better.  It  will  frequently 
happen  that,  if  lay-offs  in  one  department  are  known  in  time, 
the  workers  can  be  shifted  to  other  departments.  If  the  lay-off 
is  definitely  temporary  and  the  alternate  work  pays  less  than  that 
from  which  workers  arc  being  laid  off,  a  separate  "retainer  fee" 
can  be  devised,  which  represents  the  difference  between  the  two 
rates.  Workers'  objections  to  this  sort  of  transfer  have  been 
successfully  overcome  in  several  plants  where  by  the  device  of 
a  "retainer  fee,"  earnings  at  the  lower  paid  work  were  made  to 
equal  the  workers'  former  income. 

In  the  second  place,  the  factory  force  will  have  much  more  flex- 
ibility if  the  personnel  department  adopts  a  policy  of  training 
for  more  than  one  job.  Whether  such  training  is  undertaken 
initially  or  on  the  side  while  the  worker  does  his  own  job  is  of 
secondary  importance.  The  important  thing  is  to  realize  that 
if  the  worker  knows  but  one  operation,  irregular  work  cannot  at 
times  be  avoided.  This  idea  gets  useful  elaboration  in  those 
plants  that  have  a  flying  squadron  (usually  picked  with  the 
advice  of  the  personnel  department),  the  members  of  which 
know  all  the  operations  of  a  plant  and  can  work  temporarily  in 
any  department  where  there  is  need  of  workers.  By  this  means 
a  smooth  flow  of  work  is  assured,  and  irregularity  of  employment 
for  those  at  adjacent  jobs  whose  work  would  otherwise  be  in- 
terrupted, is  thus  reduced. 

Selling  Methods. — Under  present  conditions  success  in  stabil- 
izing production  depends  ultimately  on  ability  to  prophesy 
demand.  Or,  to  put  it  more  explicitly,  it  depends  upon  ability 
to  get  orders  from  those  who  presumably  can  prophesy  the 
demand.  To  know  approximately  how  much  of  the  plant's  possi- 


STEADY  WORK  399 

ble  production  can  be  disposed  of  at  more  than  the  cost  of  manu- 
facture, is  essential  to  steady  operation  Superficially  this  is  a 
"sales  problem";  fundamentally  it  is  a  problem  that  ramifies 
into  the  whole  of  each  industry  and  involves  an  answer  to  those 
formidable  questions:  What  do  people  want;  and  how  much  of 
it  do  they  want?  This  problem  we  shall  speak  of  as  the  "organi- 
zation of  demand,"  and  consider  it  in  due  course. 

Tha  first  requisite  in  a  sales  policy  which  looks  toward  the 
smoothing  out  of  the  production  curve  is  the  will  to  regularize. 
The  shopworn  dictum  that  where  a  will  exists  a  way  will  be 
found,  applies  here  aptly,  as  the  experience  of  many  corporations 
shows.  The  sales  manager  must  himself  be  "sold"  enthusias- 
tically to  the  idea  of  regular  work. 

There  should  at  the  start  be  clear  agreement  in  the  executive 
staff  on  certain  fundamentals.  There  should  be  agreement 
(1)  on  the  maximum  volume  of  production  to  which  the  plant 
will  hold,  despite  excess  orders,  through  a  given  period  in  advance 
— say,  a  year;  (2)  that  this  standard  output  will  not  be  increased 
without  prior  staff  agreement;  (3)  that  the  firm  will  "go  after" 
regular  business. 

Once  agreement  is  obtained  among  the  executive  heads  to 
these  three  maxims  of  regularized  production,  it  is  impossible  for 
the  sales  department  to  descend  upon  the  plant  with  rush  orders 
requiring  overtime  work  or  an  extra  crew  of  workers,  or  enlarged 
plant,  and  then  follow  this  rush  with  long  periods  in  which  it 
secures  few  orders.  It  is  distinctly  up  to  that  department  to  get 
the  orders  coming  in  steadily  and  to  have  delivery  dates  so 
arranged  that  the  work  can  flow  regularly.  Devices  which  have 
successfully  achieved  this  end  are: 

(a)  Offering  special  inducements  to  buyers  in  off-seasons  or 
dull  periods,  either  by  discounts  or  by  promises  of  prompt  de- 
livery or  storage  at  the  plant  until  the  goods  are  wanted.  There 
is  one  firm  which  "has  induced  customers  to  put  in  advance 
estimates  of  their  monthly  requirements.  An  important  factor 
in  inducing  customers  to  give  the  estimates  is  that  although  the 
estimates  do  not  limit  the  customer,  customers  who  do  not  exceed 
their  estimates  are  preferred  in  busy  times  to  those  who  order  in 
excess  of  them."1 

(6)  Offering  inducements  to  salesmen  to  sell  in  off-seasons  or 
dull  periods.  These  may  take  the  form  of  bonuses  on  sales. 

1  SLIGHTER,  S.  H.     The  Turnover  of  Factory  Labor,  p.  271. 


400  PERSONNEL  ADMINISTRATION 

Some  firms  no  longer  use  jobbers  because  they  believe  they  can 
keep  a  more  affirmative  control  over  demand  and  sales  if  they 
make  use  of  a  sales  organization  of  their  own.  For  where  selling  is 
done  through  a  jobbing  house,  companies  find  that  the  jobbers 
"lay  down"  on  their  selling  except  in  the  midst  of  the  busy 
season.  Naturally  such  jobbers  have  no  special  interest  in 
building  up  out-of-season  sales,  unless  a  definite  inducement 
exists. 

(c)  Carrying  on  a  special  advertising  campaign  when  business 
is  slack. 

(d)  Inducing  salesmen  on  the  road  to  study  and  report  con- 
stantly  on  changes  in  the  trend  of  demand.     To  this  policy 
some  firms  which  produce  articles  in  which  style  is  a  factor, 
have  added  another.     They  find  that  if  salesmen  visit  customers 
more  frequently,  they  get  a  closer  correspondence  between  orders 
and  acceptances  of  the  finished  goods. 

(e)  Selling    in  markets  whose  dull    seasons  dovetail.     In  a 
large  country  like  the  United  States,  or  in  trade  with  South 
America,  such  different  climatic  conditions  are  found  simulta- 
neously that  sales  can  be  kept  going  on  certain  seasonal  products 
the  year  round.     The  larger  the  area  of  the  market,  the  more 
likely  is  a  brisk  demand  in  one  section  to  offset  a  slackened 
demand  in  another. 

(/)  Selling  and  advertising  an  article  with  a  trade  name  and  a 
standard  quality  for  which  a  regular  demand  can  be  built  up  on 
the  merits  of  the  article. 

(0)  Providing  a  subsidiary  line  of  goods  for  sale  which  can  be 
used  as  a  "filler."  Much  has  been  done  in  this  way  by  firms  in 
a  variety  of  industries.1  This  policy  depends  largely,  however, 
on  favorable  production  conditions,  adequate  equipment,  trained 
workers,  etc. 

Production  Methods. — If  the  executive  staff  has  agreed  to  a 
standard  volume  of  output  and  the  selling  department  has  seen  red 
the  orders,  the  production  and  personnel  departments  are  left 
the  task  of  keeping  the  work  flowing  smoothly  from  one  depart- 
ment to  the  next  This  means,  of  course,  that  there  must  always 
be  sufficient  raw  material  on  hand;  that  enough  special  parts  of 
machines  which  are  likely  to  break  are  in  stock  so  that  break- 
downs are  quickly  repaired;  that  the  method  of  perpetual  inven- 
tory is  in  use;  that  weather  conditions  have  as  far  as  possible  been 

1  See,  e.g.,  the  instances  in  SLIGHTER,  S.  II.,  op.  tit.,  pp.  272-274. 


STEADY  WORK  401 

counteracted  by  artificial  means.  Much  has  in  recent  years  been 
done  in  the  way  of  special  shelters  in  the  exposed  industries,  by 
refrigeration  and  cooling  of  the  air  in  industries  demanding  cool 
weather,  by  humidifying  in  industries  where  a  constant  per  cent, 
of  humidity  is  needed. 

Leveling  of  the  output  curve  requires  also  the  rectification  of 
any  "neck  of  the  bottle."  Many  plants  have  one  department 
where  the  work  always  tends  to  accumulate  because  it  has  never 
been  supplied  with  sufficient  machinery  or  workers.  Elimina- 
tion of  these  points  of  congestion  is  urgently  needed  in  order  to 
lessen  the  strain  and  overtime  work  required  of  those  in  the 
rushed  department,  and  to  reduce  the  risk  of  temporary  shut- 
down at  the  processes  before  and  after  it. 

Manufacturing  to  stock  is  possible,  of  course,  only  where  a 
standard  product  or  standard  parts  are  made.  Not  the  least 
value  in  a  policy  of  standardizing  parts  throughout  an  industry,  is 
that  an  accumulation  of  parts  made  to  stock  in  a  dull  period  is 
less  speculative  than  where  no  standardization  obtains. 

A  less  scientific  expedient  is  to  use  the  working  force  to  over- 
haul the  machinery  or  clean  up  and  paint  the  plant  during 
any  temporary  slump.  Some  firms  postpone  extensive  repair 
and  renovation  work  until  such  times. 

The  manufacture  of  more  than  one  type  of  goods  is  an  increas- 
ing practice.  If  a  firm  can  "dovetail"  the  busy  season  for  one 
of  its  products  with  the  busy  season  for  another,  it  can  run  the 
year  through  without  interruption. 

The  practice  of  a  total  shut-down  two  weeks  a  year  is  not  with- 
out its  advantages,  especially  if  the  period  is  chosen  in  which  work 
is  slackest,  and  if  employees  know  ahead  when  it  is  coming. 
However,  unless  workers  are  paid  during  this  vacation  as  sug- 
gested in  previous  chapters,  the  factory  closing  will  have  all 
the  effects  of  irregular  work — it  will  constitute  an  arbitrary 
withdrawal  of  the  chance  to  work  and  earn. 

Financial  Methods. — As  Mr.  H.  L.  Gantt  has  persistently 
pointed  out,1  the  price  at  which  goods  are  offered  in  dull  times 
can  affect  their  sale  tremendously.  The  manufacturer  who  can 
in  a  depression  offer  goods  at  the  same  price  as  in  normal  times, 
will  find  his  business  picking  up  sooner  and  faster  than  that  of  his 
competitors.  But,  as  Mr.  Gantt  points  out,  it  is  the  opposite  of 
this  situation  which  usually  takes  place.  Since  overhead  charge? 

1  See  GANTT,  II.  L.  Work,  Wages  and  Profits. 

26 


402  PERSONNEL  ADMINISTRATION 

have  remained  constant  as  demand  falls,  the  manufacturer 
charges  all  his  overhead  into  the  cost  of  the  small  output  which, 
let  us  say,  he  is  producing  with  40  per  cent,  of  his  equipment;  and 
in  consequence  the  price  at  which  he  can  offer  it  with  the  falling 
demand  is  too  high  to  stimulate  sales.  If,  however,  a  proper 
cost  system  is  in  use,  overhead  charges  are  not  assessed  in  this 
lump-sum  manner.  They  are  distributed  on  a  square  foot  basis, 
or,  as  is  usually  to  be  preferred,  on  a  machine-hour  basis;  that 
is,  so  much  of  the  total  overhead  costs  as  are  used  by  a  machine 
in  each  hour  of  its  operation  are  charged  to  it  when  it  operates. 
Obviously,  machine  costs  remain  nearly  the  same  whether  one  ma- 
chine runs  or  a  hundred.  And,  selling  on  a  basis  of  actual  unit 
costs,  the  manufacturer  is  able  to  offer  more  nearly  the  same  price 
in  dull  and  in  good  times. 

But,  it  will  be  said,  there  is  still  an  extra  burden  of  cost  in  this 
situation.  True;  but  that  extra  burden  is  not  incurred  in  the 
manufacture  of  the  relatively  few  articles  being  made  in  the  dull 
time — articles  which  it  is  greatly  to  the  plant's  interest  to  increase 
the  sale  of  in  order  to  bring  it  out  of  its  dull  season.  This  extra 
burden  is  in  the  nature  of  a  general  risk  of  the  entire  enterprise 
and  should  really  be  figured  into  final  profit-and-loss. 

In  short,  sound  methods  of  cost-keeping  will  tell  unit  costs 
accurately  and  make  it  easier  than  it  otherwise  would  be,  to 
offer  goods  at  a  moderate  price  at  a  time  when  only  low  prices 
will  stimulate  sales. 

The  financial  department  can  also  do  an  educational  service 
to  the  entire  staff  by  computing  and  dwelling  upon  the  high 
costs  of  irregular  work ;  costs  of  idle  equipment,  loss  of  experienced 
workers  who  are  laid  off  and  do  not  return,  training  of  new 
workers,  reduced  output  immediately  before  and  after  a  lay-off, 
etc. 

With  these  costs  known,  it  will  then  be  easy  for  the  manage- 
ment to  reckon  how  much  more  expensive  than  irregular  work 
with  no  method  of  continuing  definite  relationship  with  workers 
when  they  are  laid  off,  would  be  a  method  of  annual  compensa- 
tion which  assured  at  least  the  longer  employed  workers  a  regular 
income.  In  many  firms  the  difference  between  the  two  will  be 
found  upon  accurate  analysis  to  be  surprisingly  small. 

In  short,  the  problem  of  regularizing  work  in  so  far  as  it  can 
be  iolved  by  the  factory,  is  a  problem  of  intelligent  coordination 
in  the  efforts  of  the  staff  departments.  And  if  the  whole  execu- 
tive staff  knows  and  agrees  upon  the  standard  volume  of  produc- 


STEADY  WORK  403 

tion  for  an  extended  period  in  advance,  the  important  basic  step 
will  have  been  taken. 

Seasonal  Fluctuations. — Many  of  the  ways  of  reducing  highly 
seasonal  production  have  already  been  discussed.  A  further 
possible  help  is  found  in  those  few  communities  which  have 
brought  into  the  same  city  factories  whose  dull  seasons  offset 
each  other.  This  assumes,  however,  that  the  work  of  each  indus- 
try is  not  so  skilled  but  that  it  can  be  readily  learned  by  those 
who  turn  from  one  industry  to  another. 

But  the  larger  seasonal  movements  of  labor,  like  those  of 
harvest  workers,  lumber  workers,  hotel  resort  workers,  require 
an  agency  of  information,  cooperation  and  assistance  to  individ- 
ual workers  which  no  single  employer  can  supply — or  should 
even  try  to  supply.  The  lengthening  of  the  busy  seasons  in 
industries  of  which  these  are  typical  can  only  go  to  a  certain 
point;  and  beyond  that  the  only  relief  is  in  the  securing  of  em- 
ployment in  other  industries  for  the  remainder  of  the  year.  This 
means  two  things;  shifting  of  workers  from  one  industry  to  an- 
other; and  from  one  locality  to  another.  Neither  of  these  can 
be  easily  done,  nor  should  they  be  irresponsibly  done.  Such  a 
process  requires  protection  to  workers  and  to  the  community  at 
every  point.  To  carry  on  such  a  function  successfully  and  on 
a  nation-wide  scale,  the  country  must,  as  we  pointed  out  in 
discussing  sources  of  labor  supply,  utilize  a  universal,  non- 
competitive  and  free  service  for  the  interchange  of  employment 
information.  Such  a  service  the  United  States  government  is 
alone  in  a  position  to  render. 

Coping  with  Depressions. — But  despite  all  that  the  single  cor- 
poration or  the  public  employment  service  can  do,  a  period  of 
depression  is  likely  to  set  in  recurrently  and  make  the  securing 
of  orders  practically  impossible.  Some  firms  during  such 
periods  resort  to  a  drastic  shortening  of  the  week  for  all;  or  they 
offer  full  time  employment  one  week  to  one  half  of  their  force  and 
the  next  week  to  the  other  half.  Such  expedients  are  certainly 
better  than  no  work  and  no  earnings,  but  they  cannot  safely  be 
continued  over  more  than  two  or  three  months  at  the  longest. 
Under-employment  is  humanly  almost  as  harmful  as  unemploy- 
ment. It  tends  to  keep  workers  tied  to  half-time  employment  in 
one  place  while  full  time  work  might  be  found  elsewhere;  it 
discourages  workmanship;  it  undermines  living  standards. 

Proposals  for  supplementing  the  dull  times  of  private  business 
by  a  vigorous  prosecution  of  public  business  which  would  in 


404  PERSONNEL  ADMINISTRATION 

part  be  held  in  reserve  for  slack  periods,  are  excellent  as  far  as 
they  go.  It  is  always  true  that  the  more  people  who  have  profit- 
able employment,  the  more  likely  is  a  normal  volume  of  total 
demand  to  be  maintained.  And  if  city,  county,  state  and  nation 
were  to  adopt  a  policy  of  reserving  10  per  cent,  to  20  per  cent,  of 
each  year's  purchases  and  new  projects  to  be  started  when  a  de- 
pression seemed  imminent  some  relief  would  be  afforded.1  But 
this  leaves  the  central  problem  still  untouched. 

The  Organization  of  Demand. — The  central  problem  is  to 
secure  the  operation  of  industry  on  the  basis  of  a  response  to 
known  needs.  And  obvious  as  the  remark  may  seem  it  is  well  to 
remember  that  people's  needs  are  really  a  very  constant  quantity — 
or  rather  a  gradually  and  constantly  increasing  quantity.  One 
of  the  causes,  if  not  the  central  cause,  of  depressions  is  that  in 
successful  years  everybody's  confidence  in  the  future  is  un- 
bounded ;  every  manuf acurer  believes  that  he  can  sell  more  than 
he  ever  has  sold;  and  he  manufactures  more.  In  this  process 
a  larger  total  production  naturally  materializes  than  can  be 
sold  at  a  price  which  will  bring  a  profit;  and  a  note  of  caution  and 
conservatism  is  struck.  The  bankers  who  have  advanced  the 
credits  for  the  whole  inflation  see  that  returns  are  slowing  down ; 
they  begin  to  call  in  notes  which  cannot  be  met  at  once  because 
sales  have  not  occurred;  and  thus  begins  a  process  of  sudden 
retrenchment  which  culminates  in  a  depression. 

In  the  course  of  such  a  business  cycle,  which  has  in  this  country 
been  traversed  fairly  regularly  every  seven  years  in  the  last 
half  century,  one  of  the  conspicuous  things  that  happens  is  that 
each  individual  competing  plant  loses  sight  of  the  total  real  de- 
mand, or  imagines  that  it  can  capture  a  larger  proportion  of  the 
demand  than  it  ever  did  before.  The  total  demand,  even  if 
known,  is  not  related  to  the  producing  capacity  of  an  entire  in- 
dustry; but  more  often  the  demand  is  not  known — is  only  crudely 
estimated  by  competing  estimators,  i.e.,  sales  managers,  who 
make  it  their  business  less  to  face  the  facts  than  to  face  those 
facts  which  their  corporations  want  to  hear.  Thus,  organiza- 
tion of  the  demand,  in  this  sense  of  knowing  what  the  market  can 
absorb  out  of  the  total  possible  producing  power  of  an  industry, 
and  of  seeing  to  it  that  this  total  marketable  quantity  is  not  grossly 
overproduced,  is  impossible  in  an  industry  when  each  corporation 
is  a  law  unto  itself.  Organization  of  demand  requires  organiza- 
tion among  the  several  producing  and  selling  agencies  of  an 

1  WEBB,  SIDNEY  and  BEATRICE.     The  Prevention  of  Destitution. 


STEADY  WORK  405 

industry.  And  society  has  a  right  to  hope  that  as  each  industry 
rather  than  each  factory  comes  to  be  conceived  as  the  unit  of 
production,  the  amount  produced  will  be  more  accurately  related 
to  demand  than  is  now  possible;  and  business  cycles  will  tend  to 
disappear. 

There  are,  therefore,  certain  important  steps  toward  regulariza- 
tion  which  an  industry  as  a  whole  is  alone  in  a  position  to  under- 
take. What  such  an  organization  may  be  and  how  it  would 
function  in  relation  to  organized  employers  and  organized 
workers,  we  shall  discuss  in  the  chapter  on  national  industrial 
councils. 

An  industry  in  its  organized  capacity  can,  moreover,  help 
materially  to  organize  its  own  employment  market.1  It 
can  in  its  several  localities  draw  from  a  common  labor  supply, 
rather  than  let  each  plant  try  to  keep  enough  "hangers  on" 
to  help  it  through  a  busy  season.  It  can  by  its  organized  efforts 
reduce  the  most  acute  forms  of  seasonality  by  controlling  within 
reasonable  limits  the  introduction  and  changing  of  styles.  It 
can  encourage  standardization  of  products  and  parts. 

And  there  are  other  things  that  it  might  do,  which  under  our 
anti-trusts  laws  are  probably  at  present  illegal;  but  which  under 
proper  regulation  (assuming  a  modification  of  these  laws)  would 
help  to  steady  work.  Producers  in  different  parts  of  the  coun- 
try could,  for  example,  divide  up  the  markets  of  the  country  in 
cases  where  that  would  help.  They  might  agree  to  divide  up 
rush  business  and  business  beyond  the  capacity  of  their  plants. 
By  sub-contracting  orders  beyond  plant  capacity  or  turning  cus- 
tomers over  to  other  firms,  corporations  would  be  kept  from  the 
temptation  of  building  new  equipment  for  which  there  would 
only  be  sporadic  use.  The  total  producing  capacity  of  all  the 
plants  in  many  of  our  industries,  if  they  were  simultaneously 
operating,  would  probably  already  overproduce  the  present 
"effective  demand."  And  if  the  truth  of  this  could  be  only 
brought  home  to  employers,  workers  and  consumers  alike,  steps 
in  the  direction  of  a  more  intelligent  utilization  of  plant  might  be 
undertaken. 

Finally,  an  industry  can,  as  previously  pointed  out,  distribute 
the  risk  of  irregular  work  in  a  way  that  the  single  factory  cannot. 

1  For  a  more  extended  discussion  of  this  point  see,  TEAD,  ORDWAY,  The 
United  States  Employment  Service  and  the  Prevention  of  Unemployment, 
American  Labor  Legislation  Review,  March,  1919. 


406  PERSONNEL  ADMINISTRATION 

Compensation  to  involuntarily  idle  workers  out  of  a  special  re- 
serve fund  is  the  last  resort.  Whether  this  shall  take  the  form 
of  insurance,  an  annual  salary  or  some  other  method,  is  less 
important  to  consider  here  than  is  the  fact  that  the  maintenance 
of  idle  workers  when  no  work  is  at  hand  is  just  as  important — and 
therefore  just  as  justifiable — as  the  practice  of  maintaining  equip- 
ment or  of  drawing  on  surpluses  for  dividends  in  periods  when 
none  are  earned.  Property  can  outlast  the  suspension  of  payment 
for  its  use;  human  beings  cannot  outlive  suspension  of  their  live- 
lihood beyond  a  few  weeks. 

Organization  of  a  cooperative  character  between  workers  and 
employers  of  each  industry  is  thus  seen  to  be  vitally  necessary  be- 
fore regularization  becomes  at  all  complete.  For  regular  work  is 
the  outcome  of  regular  demand.  And  demand  is  not  known  until 
there  is  one  unified,  widespread  agency  in  each  industry  for 
ascertaining  it. 

Selected  References 

AMERICAN  ASSOCIATION  FOR  LABOR  LEGISLATION.  American  Labor  Legisla- 
tion Review.  Unemployment  Number,  v.  5,  No.  2,  June,  li»l">. 

BKVERIDOE,  W.  H.  Unemployment;  a  Problem  in  Industry.  N.  Y., 
Longmans,  Green  A  Co.,  1917.  pp.  1-15,  29-37,  68-110,  192-237. 

COMMONS,  J.  R.  and  ANDREWS,  J.  B.  Principles  of  Labor  Legislation. 
N.  Y.,  Harper  &  Bros.,  c.  1916.  pp.  261-294. 

HOBSON,  J.  A.  Problem  of  the  Unemployed;  an  Enquiry  and  iin  Eco- 
nomic Policy.  London,  Metheum  &  Co.,  Ltd.,  1911. 

M  \  1.1.1.  in  .  O.  T.  National  Policy — Public  Works  to  Stabilize  Employment. 
(In  Annals,  Am.  Acad.,  v.  81,  pp.  56-61,  Jan.,  1919.) 

Stabilizing  Demand  for  Labor.  (In  New  Republic,  v.  16,  pp.  125-127, 
August  31,  1918.) 

TEAD,  ORDWAY.  United  States  Employment  Service  and  the  Prevention  of 
Unemployment.  (In  Am.  Labor  Legislation  Review,  v.  9,  pp.  93-100, 
March,  1919.) 

TEAD,  ORDWAY.  Why  Labor  Exchanges?  A  Forecast  of  Next  Steps 
Beyond  Free  Employment  Offices.  Boston,  Mass.,  Committee  on 
Unemployment,  1915.  Bui.  No.  1,  Nov.,  1915.) 

U.  8.  EMPLOYMENT  SERVICE.  Annual  Report  of  the  Director  General, 
Fiscal  Year  Ending  June  30, 1918.  Wash.,  Govt.  Print.  Off.,  1919. 

U.  S.  EMPLOYMENT  SERVICE.  U.  S.  Employment  Service  Bulletin.  Wash., 
Govt.  Print.  Off.,  Jan.,  1918-Feb.,  1919. 

VALENTINE,  R.  G.  What  the  Awakened  Employer  is  Thinking  on  Un- 
employment. (In  Am.  Labor  Legislation  Review,  v.  5,  pp.  423-428, 
June,  1915.) 

WILIJTS,  J.  H.  Steadying  Employment.  (In  Annals.  Am.  Acad.,  v.  65, 
mipp.,  pp.  1-104,  May,  1916.) 

WOOLF,  L.  S.  Experiment  in  Dccamialization :  1 1n- 1  ,i v<>rpool  Docks  Scheme. 
(In  Economic  Journal  (London),  v.  24,  pp.  314-319,  June,  1914.) 


CHAPTER  XXVIII 
PRINCIPLES  OF  SHOP  COMMITTEE  ORGANIZATION 

The  war  had  the  effect  of  accelerating  group  relations  between 
managers  and  their  workers.  Representative  action  in  the  dis- 
cussion and  determination  of  shop  policies  and  procedure  in- 
creased significantly.  The  necessity  of  uninterrupted  production 
encouraged  employers  and  especially  the  Government  to  assure 
some  channel  of  free  communication  between  the  parties  so  that 
strikes  and  high  labor  turnover  might  be  avoided.  And  the 
result  was  an  unprecedented  extension  of  the  use  of  shop  com- 
mittees and  collective  bargaining. 

The  idea  that  committee  action  might  reduce  ill-will  and  fric- 
tion had  been  comparatively  untried  in  American  plants  before 
the  war.  And  it  was  only  in  an  almost  frantic  resort  to  every 
possible  expedient  that  committee  action  got  its  trial.  Happily, 
and  somewhat  to  their  surprise,  many  managers  were  pleased 
with  the  results,  and  would  not  now  abandon  the  new  methods 
of  joint  dealing. 

Nevertheless,  as  a  procedure  for  general  application  the  move- 
ment for  employee  representation,  or  the  shop  committee  move- 
ment, is  still  in  the  experimental  stages.  Seventy-five  per  cent, 
of  the  plans  now  operating  are  less  than  three  years  old;  and 
thirty  per  cent,  are  less  than  one  year  old.  It  is,  therefore,  too 
early  to  discuss  the  success  of  the  movement  with  any  great 
array  of  evidence.  But  it  is  profitable  to  consider  the  reasons 
for  this  movement;  the  different  types  of  employee  organizations; 
their  relative  merits  from  the  point  of  view  of  effective  business 
values  and  the  draw-backs  as  thus  far  revealed. 

The  Reasons  for  Shop  Committees. — The  motives  which  have 
led  employers  to  study  and  put  into  operation  shop  committees 
are  naturally  numerous  and  often  mixed.  The  dominant  aims 
may,  however,  be  divided  into  those  which  are  negative  and  those 
which  are  positive. 

The  principal  negative  motive  is  fear — fear  of  the  action  of 
trade  unions.  The  claim  is  frequently  voiced  that  "if  I  give  my 

407 


408  PERSONNEL  ADMINISTRATION 

workers  a  voice  in  controlling  conditions  in  our  shop,  there  will 
be  no  place  for  any  outside  organization."  The  idea  is  to  antici- 
pate the  union  organizer,  to  create  an  intra-plant  "collective 
bargain,"  "to  deal  only  with  my  own  men."  It  is  the  honest 
conviction  of  many  employers  that  they  can  not  only  preclude 
union  action  by  some  sort  of  committee  action,  but  that  they  can 
deal  more  satisfactorily  with  their  own  workers  in  the  absence 
of  all  outside  interference. 

Of  the  positive  motives  there  are  several, — some  which  stress 
the  production  arguments,  some  the  human.  One  of  the  fre- 
quent causes  of  employers'  interest  in  the  committee  movement 
is  the  desire  "to  get  production  on  a  better  basis."  Indeed, 
there  is  a  danger  that  employers  who  are  handicapped  by  old 
plants,  worn-out  equipment  or  inadequate  methods  of  control 
and  superintendence,  will  try  to  make  shop  committees  respon- 
sible for  the  correction  of  short-comings  which  in  reality  the 
management  should  remedy.  Casting  about  for  "a  solution  of 
the  labor  problem"  which  will  save  them  the  hard  work  of  com- 
petent management,  some  employers  have  seized  with  more 
enthusiasm  than  discretion  upon  shop  committees 

Other  companies  have  seen  more  clearly  that  there  is  a  psycho- 
logical connection  between  representation  in  shop  affairs  and 
interest  in  work.  They  know  that  the  experience  of  some  plants 
where  workers  have  conferred  on  production  problems  has  been 
decidedly  beneficial  to  production  and  to  morale.1 

Far-sighted  industrial  leaders  are  also  finding  in  the  com- 
mittee movement  an  educational  medium  of  great  value.  They 
realize  that  employees,if  they  are  to  take  interest,  assume  respon- 
sibility, display  initiative  and  share  further  in  industrial  control, 
must  know  the  inner  workings  of  industry  and  must  know  how 
to  act  in  executive  capacities, — or  at  least  know  how  to  advise 
with  those  in  executive  positions  as  to  what  the  administration 
should  be.  And  they  see  in  any  form  of  group  action  which  gives 
employees  in  some  organized  way  a  knowledge  of  management 
and  a  chance  to  deliberate  with  the  management,  great  educa- 
tional possibilities.  Employee  representation  can,  they  believe, 
be  the  cradle  of  industrial  democracy,  as  the  town  meeting  was  of 
political  democracy. 

The  purpose  of  better  human  relations  is  in  one  sense  an  educa- 
tional purpose — instructive  to  both  management  and  men  in  a 

>  flee  Chapter  XV. 


PRINCIPLES  OF  SHOP  COMMITTEE  ORGANIZATION    409 

point  of  view  which  makes  for  cordial  dealings.  If  it  is  true 
that  certain  interests  of  the  men  diverge  from  those  of  manage- 
ment, there  is  no  reason  why  a  consideration  of  those  divergences 
cannot  be  carried  on  amicably,  or  why  a  working  arrangement 
cannot  be  reached  in  conference,  which  will  be  to  the  temporary 
satisfaction  of  all  concerned.  And  unquestionably  the  most 
reliable  way  to  maintain  this  atmosphere  of  personal  good-feeling 
is  the  method  of  direct,  face-to-face  discussion. 

Moreover,  since  at  least  half  of  the  matters  which  both  sides  are 
interested  to  see  well  administered  are  matters  of  undeniably 
common  interest,  there  is  ground  here  also  for  the  cultivation 
of  mutual  understanding  and  personal  amiability.  Managers 
should  bear  in  mind  that  industrial  differences — except  those 
arising  out  of  personal  quarrels  with  foremen — are  essentially 
impersonal  in  nature;  and  they  can  be  kept  so  if  only  the  parties 
involved  know  each  other  sufficiently  well  in  a  personal  sort  of  way. 
In  the  cultivation  of  this  personal  intimacy  it  is  the  management 
which  must  necessarily  take  the  first  step;  so  that  if  any  element 
of  personal  acrimony  enters  into  a  consideration  of  differences 
between  it  and  the  workers,  it  is  in  part  at  least  the  manage- 
ment which  is  to  blame.  Committee  action  can  admirably 
serve  this  purpose  of  establishing  personal  contact  if  only  it  is 
properly  directed  and  guided. 

The  first  article  in  the  constitution  of  one  shop  committee  plan 
well  describes  this  primary  purpose  when  it  declares  that  the 
plan  aims  "to  establish  relations  upon  a  definite  and  durable 
basis  of  mutual  understanding  and  confidence.  To  this  end  the 
Employees  and  the  Management  shall  have  equal  representation 
in  the  consideration  of  all  questions  of  policy.  .  .  .>M 

There  is  another  penetrating  purpose  of  those  companies  which 
realize  that  individual  dealings  between  a  large  corporation  and 
each  of  its  workers  is  today  an  anachronism;  and  realize  that  it 
involves  a  great  inequality  of  bargaining  power  and  therefore  is 
bound  sooner  or  later  to  give  rise  to  a  feeling  of  unjust  treatment 
on  the  part  of  the  workers.  Such  companies  realize  that  "the 
goodwill  of  labor  is  a  collective  goodwill" — that  is,  that  the  sense 
of  fair  and  cordial  dealing  is  secured  only  when  dealings  are  with 
the  workers  as  an  organized  group.  And  Professor  Commons 

1  Harvester  Industrial  Council  (pamphlet),  March  10,  1919;  apian  which 
is  carefully  thought  through  in  all  its  details.  It  will  repay  thoughtful 
study. 


410  PERSONNEL  ADMINISTRATION 

offers  as  the  reason  for  this,  the  fact  which  most  progressive 
employers  are  already  prepared  to  concede,  that  "  the  employer 
always  speaks  as  a  representative  of  organized  capital.  Unless 
the  laborer  can  speak  as  a  representative  of  associated  laborers, 
he  cannot  speak  with  equal  power."1 

Another  thoughtful  student  in  asking  why  so  little  progress 
has  been  made  in  fostering  cooperation  says,  "A  reason  for  this 
situation  is  found  in  the  lack  of  understanding  on  the  part  of 
industrial  executives  that  to  build  morale  or  the  spirit  of  the 
organization,  their  working  people  must  be  appealed  to  in  the 
mass  and  not  as  individuals."2  Whether  or  not  intra-plant 
committee  action  can  provide  equality  of  bargaining  is  a  question 
which  will  have  to  be  considered  presently  in  discussing  the 
values  and  short-comings  of  the  committee  movement.  We 
are  here  only  stating  the  fact  that  certain  employers  believe  that 
equal  bargaining  power  can  be  so  achieved. 

Types  of  Employees'  Organizations. — There  are  from  the  point 
of  view  of  structure  three  distinct  types  of  employee  organizations 
which  are  being  introduced  today : 

1.  The  plans  of  joint  action  of  managements  and  their  own 
employees  on  councils,  committees,  conferences,  assemblies,  etc. 
In  this  volume  all  such  plans  will  be  spoken  of  as  shop  committee 
plans  or  as  works  committee  plans — the  two  terms  being  used 
i  n  terchangeably .  * 

2.  The  plan  of  an  employees'  association,  "cooperative  asso- 
ciation," or  "brotherhood"  in  which  all  employees  are  usually 
included.     We  shall  designate  this  plan  in  our  discussion  as  the 
"employees'  association"  plan. 

3.  The   so-called   "federal   plan"   which   proposes   for  each 
factory  a  structure  analogous  to  that  of  our  Federal  government 
— with  a  cabinet  of  executives,  a  senate  of  foremen  and  a  house  of 
representatives  composed  of  departmental  delegates.4 

1  COMMONS,  JOHN  R.     Industrial  Goodwill,  p.  48. 

1  ALPORD,  L.  P.  The  Status  of  Industrial  Relation*.  (In  Industrial 
Management,  July,  1910.) 

*  None  of  these  definitions  are  offered  as  either  representative  of  universal 
usage  or  as  necessarily  the  best  possible  usage.  They  are  simply  the  termx 
with  which  we  here  agree  to  designate  certain  types  of  organization. 

4  In  order  that  there  may  be  no  confusion  we  cite  below  examples  of  each 
type: 

1.  International  Harvester  Company. 

General  Electric  Company,  Lynn,  Mass,  and  Pittafield,  Mass. 
Midvale  Steel  Company. 


PRINCIPLES  OF  SHOP  COMMITTEE  ORGANIZATION    411 

A  distinguishing  feature  of  all  three  types  of  organization  is 
that  without  any  exception  which  has  yet  come  to  our  attention 
the  management  has  thus  far  taken  the  initiative  in  getting 
these  plans  under  way.  This  fact,  of  course,  helps  to  separate 
them  from  what  is  usually  spoken  of  as  "collective  bargaining,  " 
where  the  workers  are  affiliated  with  a  trade  or  labor  organiza- 
tion including  employees  of  other  companies  in  its  membership, 
and  where  the  formal  agreement,  if  any  exists,  is  made  by  the 
employer  with  that  organization  usually  upon  its  initiative. 
We  shall  for  the  purposes  of  this  volume  use  the  term  "collective 
bargaining"  to  characterize  this  last-mentioned  type  of  joint 
relation — i.e.,  an  agreement  with  an  organization  of  workers 
which  includes  in  its  membership  others  than  those  in  the  em- 
ploy of  one  corporation. 

General  Principles  Underlying  All  Employees'  Organizations. — 
Up  to  a  certain  point  the  problems  of  adopting  and  administering 
shop  committees  and  employees'  associations  are  the  same; 
certain  principles  of  procedure  are  common  to  both. 

The  first  principle — the  one  which  should  preface  every 
discussion  of  method — is  that  the  best  forms,  methods  and 
machinery  known  are  of  little  avail  if  they  are  not  animated  by  a 
sincere,  genuine  and  liberal  intention.  "That  which  attaches 
people  to  us,"  said  Matthew  Arnold,  "is  the  spirit  we  are  of  and 
not  the  machinery  we  employ."  Similarly,  a  present-day 
student  of  industry  well  says : 

"I  believe  that  the  application  of  right  principles  never  fails  to  effect 
right  relations;  'that  the  letter  killeth  but  the  spirit  giveth  life';  that 
forms  are  wholly  secondary,  while  attitude  and  spirit  are  all-important; 
and  that  only  as  the  parties  in  industry  are  animated  by  the  spirit  of 
fair  play,  justice  to  all  and  brotherhood,  will  any  plan  which  they  mutu- 
ally work  out  succeed."1 

In  other  words,  there  is  little  use  for  dogmatism  in  discussing 
plans  of  structure.  We  need  rather  to  consider  at  first  the  out- 

1  ROCKEFELLER,  JOHN  D.,  JR.,  Representation  in  Industry,  address  at 
Atlantic  City,  Dec.  5,  1918. 

2.  Win.  Filene  Sons  Company. 
Interborough  Rapid  Transit  Company. 
Morse  Dry- Dock  and  Repair  Company. 

3.  Sidney  Blumenthal  Company. 
John  David  Sons  and  Company. 
William  Demuth  and  Company. 
Printz-Biederman  Company. 


412  PERSONNEL  ADMINISTRATION 

standing  points  of  approach  which  will  help  to  give  tangible 
evidence  of  a  sincere,  spirit — assuming,  of  course,  that  a  sincere 
and  liberal  purpose  is  present. 

Perhaps  the  surest  way  to  evidence  this  right  spirit  is  to  have 
it  clearly  understood  from  the  start,  implicity  and  explicitly, 
that  this  is  not  a  trade  union  defeatist  move.  The  following 
paragraphs  from  an  English  source  apply  with  equal  force  in  our 
country,  especially  since  the  American  Federation  of  Labor  went 
on  record  in  its  1919  convention  as  opposed  to  "company 
unions." 

"We  think  it  important  to  state  that  the  success  of  the  works  com- 
mittees would  be  very  seriously  interfered  with  if  the  idea  existed  that 
such  committees  were  used,  or  likely  to  be  used,  by  employers  in  oppo- 
sition to  trade  unionism.  It  is  strongly  felt  that  the  setting  up  of  works 
committees  without  the  cooperation  of  the  trade  unions  and  the  em- 
ployers' associations  in  the  trade  or  branch  of  trade  concerned  would 
stand  in  the  way  of  the  improved  industrial  relationships  which  in 
these  reports  we  are  endeavoring  to  further. 

"In  an  industry  where  the  workpeople  are  unorganized,  there  is  a 
danger  that  works  committees  may  be  used,  or  thought  to  be  used,  in 
opposition  to  trade  unionism.  It  is  important  that  such  fears  should  be 
guarded  against  in  the  initiation  of  any  scheme.  We  look  upon  success- 
ful works  committees  as  the  broad  base  of  the  industrial  structure  which 
we  have  recommended,  and  as  the  means  of  enlisting  the  interest  of  the 
workers  in  the  success  both  of  the  industry  to  which  they  are  attached 
and  of  the  workshop  or  factory  where  so  much  of  their  life  is  spent. 
These  committees  should  not,  in  constitution  or  methods  of  working, 
discourage  trade  organizations."1 

A  second  essential  step  in  giving  evidence  of  the  right  spirit 
is  to  have  the  employees  consider  with  the  management  from  the 
start,  what  the  plan  shall  be.  Their  interest,  their  belief  in  the 
management's  good  intention,  their  sense  of  the  satisfactoriness 
of  the  finished  plan, — will  all  be  greatly  enhanced  if  the  manage- 
ment takes  it  up  with  them  before  any  plan  whatsoever  is  put 
on  paper.  In  an  address  concerning  the  adoption  of  the  Har- 
vester Industrial  Council,  Mr.  Cyrus  McCormick,  Jr.,  said  on 
this  point: 

"So  pleased  are  we  with  the  operation  of  this  plan  that  the  only  thing 
I  can  say  about  it  is  that  if  we  had  to  do  it  all  over  again — and  I  advise 

1  See  reprint  of  Whitley  Report  in  The  Industrial  Council  Plan  of  Great 
Britain,  compiled  by  the  Bureau  of  Industrial  Research,  New  York,  p.  34. 


PRINCIPLES  OF  SHOP  COMMITTEE  ORGANIZATION    413 

those  who  follow  to  take  this  lessson  from  us — we  would  not  devise  a 
plan  and  then  ask  a  workingman  if  he  desired  to  accept  it,  but  we 
would  begin  by  asking  him  if  he  wanted  a  plan  of '  industrial  democracy,' 
and  if  he  replied  affirmatively,  we  would  ask  him  to  come  in  and  help 
devise  a  plan  with  us." 

Similarly,  another  firm  faced  with  the  question  of  how  to  "put 
it  up  to  the  men"  tells  of  the  following  conclusion  voiced  by 
an  influential  executive: 

"Why  not  be  frank?"  he  said.  "Why  not  call  a  mass  meeting  of  the 
employees,  for  example,  half  an  hour  before  closing  time,  and  place  the 
whole  matter  before  them  just  as  it  is?  .  .  .  Tell  them  that  you  do  not 
want  to  'put  anything  over,'  and  that  you  want  them  to  select  a  com- 
mittee in  their  own  way  to  discuss  it  with  you,  a  union  or  non-union 
committee — any  kind  of  a  committee  so  long  as  it  is  fairly  representa- 
tive. Put  all  your  cards  on  the  table.  Ask  them  to  put  theirs  down, 
too. 

"Well,  the  directors  took  my  advice,  and  I  am  glad  to  report  that  it 
succeeded."1 

We  agree  with  these  conclusions  with  the  important  quali- 
fication that  there  will  be  factories  where,  usually  because  of  long 
traditions  of  managerial  autocracy,  the  employees  will  not  express 
(and  indeed  not  even  be  conscious  of)  any  desire  for  "industrial 
democracy."  In  such  cases  the  complacency,  or  rather  hyper- 
developed  submissiveness  of  the  workers,  will  have  to  be  modified 
before  any  plan  of  employee  representation  will  succeed. 

John  Stuart  Mill,  whose  essay  on  "Representative  Govern- 
ment" should  be  read  by  every  manager  who  is  considering  the 
institution  of  employee  organizations,  says  relevantly  to  such  a 
situation  of  passive  acquiescence : 

"  It  is  also  to  be  borne  in  mind  that  political  machinery  does  not 
act  of  itself.  As  it  is  first  made,  so  it  has  to  be  worked,  by  men,  and 
even  by  ordinary  men  ....  It  needs,  not  their  simple  acquiescence, 
but  their  active  participation;  and  must  be  adjusted  to  the  capacities 
and  qualities  of  such  men  as  are  available.  This  implies  three  conditions. 
The  people  for  whom  the  form  of  government  is  intended  must  be  willing 
to  accept  it ;  or  at  least  not  so  unwilling,  as  to  oppose  an  insurmountable 
obstacle  to  its  establishment.  They  must  be  willing  and  able  to  do 
what  is  necessary  to  keep  it  standing.  And  they  must  be  willing  and 
able  to  do  what  it  requires  of  them  to  enable  it  to  fulfill  its  purposes." 

1  STOOD ARD,  W.  L.  Installing  a  Shop  Committee  System.  (In  The 
Survey,  July  12,  1919.) 


414  PERSONNEL  ADMINISTRATION 

Preliminary  educational  work  of  a  personal  sort  among  the 
employees  or  the  leaders  of  employees  is  indispensable  to  a 
sound  beginning  of  shop  committees.  "A  people,"  says  Mill 
later  in  the  same  essay,  "may  be  unprepared  for  good  institutions; 
but  to  kindle  a  desire  for  them  is  a  necessary  part  of  the  pre- 
paration." Discussion  among  workers  can  profitably  be  started 
as  to  the  need  for  a  plan,  the  best  procedure,  ways  and  means 
of  securing  an  understanding  adoption  of  it.  Among  employ- 
ment administrators  agreement  upon  this  principle  is  universal; 
there  must  be  painstaking  personal  educational  work  prior 
to  the  proposing  of  the  idea  of  employee  representation  and  prior 
to  the  adoption  of  the  proposed  plan.  Such  personal  conference 
takes  time.  Hence  the  next  principle,  which  relates  to  the 
administrative  oversight  of  employee  organizations. 

The  administration  of  all  work  incident  to  the  adoption  of 
employee  representation  should  be  placed  with  the  personnel  ex- 
ecutive; and  he  and  his  staff  should  take  time  enough  to  do  the 
necessary  follow-up  work  at  every  point.  And  after  the  plan  is 
in  operation  there  is  imperative  need  for  some  managerial 
leadership,  or  at  least  for  some  one  in  the  management  to  have 
direction  over  the  management's  part  in  the  plan;1  and  this 
person  should  be  someone  from  the  personnel  executive's  office. 

The  plan  should  be  put  into  writing  for  final  action;  and  this 
written  plan  should  (so  far  as  shop  committees  are  concerned) 
make  provisions  to  cover  the  items  discussed  in  the  next  chapter. 
This  plan  after  it  has  been  favorably  acted  on  by  manage- 
ment and  men,  will  then  be  in  effect  the  working  con- 
sitution  of  the  plant.  Matters  likely  to  require  frequent  change, 
such  as  hours,  rates  of  pay  and  other  details  of  terms  of  employ- 
ment, should  preferably  not  be  included  in  the  constitution. 
They  should,  of  course,  be  definitely  formulated  and  agreed  to; 
but  they  correspond  more  to  statutes  and  ordinances  than  to 
"organic  law." 

The  permanence  of  employees'  interest  in  the  plan  is  likely  to  be 
in  proportion  to  the  degree  of  responsibility  exercised  by  them; 
and  in  proportion  to  the  amount  of  authority  vested  in  the  repre- 
sentative bodies  created.  This  principle  seems  to  us  to  argue 
in  favor  of  joint  bodies  on  which  both  sides  are  equally  repre- 

1  This  is  so  far  recognized  in  most  of  the  plans  that  they  specifically  pro- 
vide for  a  separate  staff  department,  usually  the  Personnel  Department, 
to  handle  the  administration  of  the  plan. 


PRINCIPLES  OF  SHOP  COMMITTEE  ORGANIZATION    415 

sented.  For  under  such  conditions  of  joint  participation  a 
considerable  measure  of  both  responsibility  and  authority  can 
be  safely  exercised  by  the  committees  at  an  early  date  after 
their  creation. 

There  is  some  question  as  to  how  detailed  the  statement  of 
responsibilities  and  the  grant  of  authority  should  be.  If  a  specific 
understanding  on  these  matters  can  be  agreed  to  by  both  sides 
when  the  plan  is  under  consideration,  that  simplifies  the  im- 
mediate problem.  But  to  raise  at  the  outset  question  as  to 
how  far  the  plan  is  to  go  in  turning  over  problems  for  the  em- 
ployees to  consider  and  solve,  may  raise  issues  which  can  be 
more  satisfactorily  met  when  the  plan  has  been  in  operation  for 
a  time. 

However,  some  of  the  best  shop  committee  plans  provide 
from  the  start  that  all  matters  of  mutual  interest  may  properly 
be  considered  by  the  employees'  bodies.  And  such  a  provision 
can  usually  be  introduced  to  advantage,  if  the  management 
is  prepared  to  go  that  far.  For  it  will  in  general  be  found  true 
that  employees  only  call  attention  to  and  demand  consideration 
of  problems  which  they  think  affect  them;  and  that  they  ask.  to 
exercise  authority  only  when  they  are  close  to  the  point  where  they 
are  able  to  exercise  it.  This  last  statement  is  open  to  exceptions; 
but  the  history  of  the  rise  of  all  groups  to  self-government 
tends  to  bear  it  out. 

There  is  another  point  which  those  managers  who  want  to 
"get  employees  to  take  the  whole  responsibility  for  production 
off  my  hands,"  should  especially  note.  Representative  bodies 
by  the  nature  of  their  structure  and  their  function  should  not 
be  administrative  bodies.  An  administrative  body  may  be  re- 
presentative— as,  for  example,  a  plant's  operating  committee 
may  include  representatives  of  plant,  process,  personnel,  etc.,  etc., 
in  which  case  each  member  of  the  body,  as  an  individual,  has 
certain  administrative  duties.  But  a  representative  body  has 
always  been  conceived  by  discriminating  students  as  of  a  different 
Essence. 

Indeed  the  following  legend  might  well  be  written  in  letters 
of  gold  on  the  walls  of  every  room  where  shop  committees  meet: 

"The  proper  duty  of  a  representative  assembly  in  regard  to 
matters  of  administration  is  not  to  decide  them  by  its  own  vote, 
but  to  take  care  that  the  persons  who  have  to  decide  them  shall 
be  the  proper  persons."  "Instead  of  the  function  of  govern- 


416  PERSONNEL  ADMINISTRATION 

ing,  for  which  it  is  radically  unfit,  the  proper  office  of  a  repre- 
sentative assembly  is  to  watch  and  control  the  government,  to 
throw  the  light  of  publicity  on  its  acts;  to  compel  a  full  expo- 
sition and  justification  of  all  of  them  which  anyone  considers 
questionable "* 

There  is  a  tendency  all  too  frequently  met  in  new  shop  com- 
mittee plans  to  turn  over  certain  administrative  matters  to 
committees.  But  such  committees  if  without  competent  leader- 
ship are  apt  to  display  a  greater  capacity  for  talk  than  for  action. 
Every  committee  must  look  to  some  one  or  another  of  its  members 
to  do  the  work.  "No  body  of  men,  unless  organized  and  under 
command,  is  fit  for  action  in  the  proper  sense."  The  executive  task 
which  a  committee  can  effectively  exercise  is  the  choice  of  the  individ- 
uals on  the  committee  who  are  to  do  certain  parts  of  the  job  turned 
over  to  the  committee.  People  are  in  the  habit  of  lamenting  over 
the  inefficiency  of  representative  institutions,  and  of  attributing 
their  inefficiency  to  the  fact  of  representation.  More  accurately 
we  should  say  that  the  inefficiency  is  frequently  due  to  applying 
the  principle  of  representation  in  the  wrong  place.  The  following 
caution  is  thus  in  special  need  of  emphasis: 

"Nothing"  says  Mill  at  the  end  of  the  chapter  just  quoted, 
"but  the  restriction  of  the  function  of  representative  bodies 
within  these  rational  limits,  will  enable  the  benefits  of  popular 
control  to  be  enjoyed  in  conjunction  with  the  no  less  important 
requisites  (growing  ever  more  important  as  human  affairs  in- 
crease in  scale  and  in  complexity)  of  skilled  legislation  and 
administration." 

Finally,  the  company  which  starts  a  shop  committee  should 
be  prepared  to  go  whither  the  way  leads.  Nothing  has  tended 
BO  effectually  in  times  past  to  discredit  all  forms  of  "management 
sharing"  with  employees,  as  their  experience  of  having  employers 
abandon  experiments  as  soon  as  they  felt  that  "matters  were 
getting  beyond  our  control."  The  management  of  every  cor- 
poration venturing  into  this  field  should  ask  itself:  "Are  we 
prepared  to  relinquish  any  of  our  control  and  authority  in  any 
direction?"  Is  the  company's  desire  to  assure  a  square  deal 

*8ee  Mill,  J.  8.  Considerations  on  Representative  Government, 
Chapter  V  on  The  Proper  Functions  of  Representative  liodioH, 
which  is  a  Rein  of  penetrating  analysis — all  of  which  is  applicable  to  the 
problem  of  industrial  government. 


PRINCIPLES  OF  SHOP  COMMITTEE  ORGANIZATION    417 

with  its  men  as  the  company  sees  it,  and  to  see  justice  done  as 
the  company  senses  justice;  or  is  it  prepared  to  give  up  " ex- 
clusive control  over  wages,  hours  and  shop  discipline?"1 
"Only,"  continues  Mr.  Leiserson  in  speaking  of  the  employer, 
"when  he  is  ready  to  administer  justice  to  his  employees  as 
they  understand  justice,  only  when  he  is  ready  to  give  them 
veto  power  on  his  acts  and  to  assure  trial  by  their  peers,  a  jury  of 
fellow-employees,  should  an  employer  inaugurate  an  employee- 
representative  plan." 

Whether  or  not  one  agrees  with  this  conclusion,  it  is  important 
for  the  employer  to  realize  that  he  is  calling  into  being  agencies 
which  may  carry  him  far.  For  he  is  giving  opportunities  for 
expression  to  impulses  of  self-direction,  leadership  and  assertive- 
ness  in  his  workers,  which  will  not  stop  displaying  themselves 
at  some  point  which  the  employer  has  arbitrarily  set  in  his  own 
mind. 

These,  then,  are  the  general  problems  of  policy,  purpose  and 
principle  which  managers  should  consider  at  the  outset.  And  if, 
after  due  consideration,  their  decision  is  still  in  favor  of  working 
with  their  employees  through  committees,  it  is  next  important  for 
them  to  decide  the  matters  which  should  be  included  in  the  writ- 
ten constitution  of  the  plan. 

1  This  and  the  following  quotations  are  from  LEISERSON,  W.  M.  Em- 
ployment Management,  Employee  Representation  and  Industrial  Democ- 
racy, Proceedings  National  Association  of  Employment  Managers,  1919, 
pp. 118-124. 

Selected  References 

(See  end  of  following  Chapter.^ 


27 


CHAPTER  XXIX 
METHODS  OF  SHOP  COMMITTEE  ORGANIZATION 

There  are  certain  items  which  require  statement  or  definition 
in  any  formulated  plan  of  employee  representation  which  is  to 
meet  the  test  of  actual  use.  The  present  enumeration  aims  to 
cover  those  items  included  in  the  best  plans  now  in  operation. 
We  are  not  prepared  to  say  that  all  of  them  are  necessary  in  every 
plan.  But  they  form,  as  they  stand,  a  fairly  complete  list  from 
which  a  choice,  governed  by  local  conditions,  can  be  made. 

Provisions  of  a  Good  Plan. — (a)  Purpose. — The  preambles  of  a 
number  of  the  plans  furnish  a  statement  of  purpose  of  which  the 
following  is  typical: 

"The  Employees  and  Management undertake  by 

the  adoption  of  this  plan  of  an  Industrial  Council  to  establish 
these  relations  upon  a  definite  and  durable  basis  of  mutual 
understanding  and  confidence."1 

(6)  Definition  of  Employee.* — This  section  defines  who  can 
vote  and  hold  office;  usually  it  confines  this  privilege  to  those 
below  the  rank  of  assistant  foreman.  Also  there  is  a  provision 
in  some  plans  for  no  discrimination  against  employees  for  trade 
union  membership. 

(c)  Right  to  Vote. — Only  employees  as  defined  in  (6)  may  vote; 
with  provision  in  some  cases  for  a  minimum  age  limit  and  mini- 
mum length  of  employment  (usually  two  or  three  months). 
Both  provisions  seem  to  us  reasonable  and  sound. 

(d)  Right  to  Hold  Office. — The  right  to  hold  office  is  usually 
limited  by  requiring  a  previous  period  of  employment  (a  year  is 
used  in  some  of  the  best  plans) ;  by  requiring  a  minimum  age  (of 
twenty  years).     In  some  cases  there  is  the  further  requirement 
of  American  citizenship;  or  of  literacy  in  the  English  language. 
It  seems  to  us  that  although  the  second  of  these  requirements  is 

1  Harvester  Industrial  Council,  (pamphlet),  March  10,  1919. 

1  For  careful  comparative  analysis  of  the  provisions  of  twenty  plans,  see 
American  Company  Shop  Committee  Plans,  by  Bureau  of  Industrial 
Research,  New  York,  1919. 

418 


METHODS  OF  SHOP  COMMITTEE  ORGANIZATION      419 

presumably  included  in  the  first,  it  is  under  present  conditions  a 
more  relevant  and  reasonable  requirement  than  the  first.1 

(e)  Basis  of  Representation. — Practically  all  plans  provide  for 
department  representation  on  the  central  shop  or  works  commit- 
tee, with  each  department  selecting  its  own  delegate.  The  num- 
ber of  delegates  from  each  department  depends  on  the  size  of 
the  department,  the  nature  of  the  plan,  the  number  of  depart- 
ments and  the  total  number  of  employees.  In  a  plant  with 
1000  employees,  fairly  equally  distributed  among  the  depart- 
ments, it  would  seem  that  one  representative  per  department 
would  usually  assure  adequate  representation.  The  idea  of  having 
one  delegate  to  every  100  employees  or  major  fraction  may, 
however,  be  usefully  applied  in  a  large  department  and  in  large 
plants. 

The  important  end  to  achieve  under  any  condition  is  that 
one  delegate  speaks  for  only  as  many  people  as  he  can  have 
convenient  access  to.  If  the  number  of  this  constituency  goes 
over  100  (which  is  too  many  in  small  plants),  his  voice  is  in  danger 
of  not  being  fairly  representative.  Reconciled  with  this  object 
should  be  the  purpose  of  keeping  the  central  committee  as 
small  in  size  as  is  consistent  with  adequate  representation. 
This  body  should  not  have  more  than  40  or  less  than  12  members; 
and  the  smaller  it  is,  the  more  effective  its  deliberations  will  be. 

Where,  as  is  sometimes  the  case,  there  are  several  crafts  in 
the  shop,  whose  members  belong  to  craft  unions  and  desire  rep- 
resentation on  a  craft  as  well  as  a  departmental  basis,  there  is 
much  to  be  said  for  electing  at  large  one  or  more  delegates  from 
each  unionized  group.  For  example,  in  a  cotton  mill  in  which 
the  weavers  and  loom-fixers  were  strongly  organized  there  might 
be  nominated  from  these  two  union  groups  two  candidates  for 
each  union  to  be  voted  on  by  the  employees  in  the  regular  shop 
committee  election.  In  this  way  there  would  be  on  the  committee 
one  delegate  expressly  representing  each  unionized  group. 

In  some  plants  even  in  the  absence  of  unions,  a  craft  basis  of 

1  Judge  Samuel  Alschuler  in  the  Chicago  packing  house  wage  arbitration 
said  on  August  14,  1919,  that  in  employing  workers  discrimination  against 
non-citizens  was  most  inadvisable.  He  pointed  out  that  such  discrimination 
might  lead  to  international  complications  since  "the  Government  super- 
vised immigration  and  such  foreign  citizens  as  had  come  to  this  country 
were  entitled  to  equal  opportunities  with  American  citizens." — New  York 
Times,  August  16,  1919. 


420  PERSONNEL  ADMINISTRATION 

representation  may  be  more  equitable  than  a  departmental  basis. 
Or  a  combination  of  both  bases  may  be  used. 

Where  women  are  in  the  majority  in  a  department,  it  will 
usually  be  well  for  a  woman  to  represent  the  department,  al- 
though if  this  can  be  achieved  without  special  statutory  provision 
it  is  more  desirable.  But  if  women  are  in  a  minority  in  several 
departments  it  may  be  well  to  have  a  number  of  women  delegates, 
elected  by  the  women  at  large,  the  total  number  to  be  determined 
on  a  basis  of  the  number  of  employees  per  delegate  that  there 
are  in  a  majority  of  the  departments. 

In  addition  to  the  works  committee,  however,  there  should 
be  a  company  council  in  all  large  corporations  which  have  several 
plants,  and  which  desire  to  call  together  representatives  from 
the  entire  corporation.  On  such  a  council  there  should  be  at 
least  two  employee  delegates  from  each  plant;  although  a  repre- 
sentation based  on  the  number  in  the  plant  (one  delegate  to  a 
given  number  of  workers)  may  also  be  used. 

(/)  Representation  of  Management. — On  the  central  works 
committee  the  management  should  appoint  a  number  of  execu- 
tives to  represent  it,  equal  in  number  to  the  workers'  group. 
At  least  a  fourth  of  the  management  delegates  should  be  foremen 
in  order  to  assure  them  an  active  place  on  this  body. 

(0)  Method  of  Nomination. — The  important  thing  here  is  to 
make  everyone  feel  that  nomination  is  easily  available  for  any 
candidate  desired  by  any  group,  however  small.  Nominations 
should  be  held  several  days  before  the  election ;  a  week  seems  to 
us  a  reasonable  time.  They  will  be  most  satisfactory  if  a  blank 
ballot  is  used  and  the  voter  writes  the  names  of  his  nominees. 
The  number  of  nominees  declared  nominated  can  be  two  (or 
three)  times  the  number  to  be  elected. 

The  officials  who  are  to  supervise  the  balloting  both  for 
nominations  and  elections  should  be  a  joint  committee  equally 
representing  management  and  men. 

(/»)  Method  of  Election. — Nominations  should  be  posted  for 
several  days  before  elections.  There  should  be  provided  a  place 
for  the  election  which  is  convenient  and  free  "from  undue  influ- 
ence," and  a  definite  time  during  which  all  can  have  access  to  the 
polls,  and  a  secret  ballot.  Results  of  elections  should  be  posted 
promptly  and  the  names  of  the  elected  delegates  should  be  per- 
manently posted  in  the  department,  so  that  all  new  employees  will 
know  through  whom  to  act  if  difficulties  occur. 


METHODS  OF  SHOP  COMMITTEE  ORGANIZATION      421 

The  term  of  office  should  be  six  months  or  preferably  a  year; 
and  the  elections  of  the  several  departments  should  be  so  ar- 
ranged that  half  the  representatives  retire  at  one  election  and 
half  at  the  next.  The  value  of  this  continuity  of  experienced 
membership  is  great. 

There  should  be  no  restriction  against  re-election  of  the  same 
individual. 

Provision  should  be  made  for  a  special  election  in  the  event 
of  an  employee  representative  leaving  the  employ  of  the  company. 

(i)  Recall. — It  should  be  possible  to  recall  an  undesirable 
representative  without  too  great  effort.  A  good  provision  is  to 
require  a  petition  of  recall  from  a  third  of  the  voters  of  a  de- 
partment, and  a  majority  vote  on  the  recall  itself. 

(j)  Composition  of  Committees. — The  company  council,  works 
committes  and  standing  committes  should,  as  already  suggested, 
be  equally  representative  of  both  sides.  But  there  should  be 
no  restriction  upon  separate  meetings  of  employees  alone. 

It  will  often  be  found  efficient  in  large  plants  to  have  an  ex- 
ecutive committee  of  the  works  committee,  which  shall  really 
be  the  steering  committee. 

Much  of  the  actual  work  of  shop  committees  will  be  done  more 
thoroughly  if  there  are  subsidiary  standing  committees.  These 
may  either  be  named  in  the  plan,  or  preferably  be  created  from 
time  to  time  as  the  need  arises.  To  list  at  the  start  a  number  of 
special  committees  over  matters  in  which  little  interest  exists 
at  the  time,  is  to  pile  up  too  cumbersome  a  structure.  These 
committees  from  the  very  nature  of  their  work  should  be  joint 
committees  appointed  by  the  works  committee.  But  it  will  be 
well  to  make  membership  on  them  possible  for  others  than 
members  of  the  works  committee.  The  job  analysis  com- 
mittee and  the  wage  rate  committee  might  well  fit  into  the 
committee  scheme  at  this  point.1 

It  is  important  to  have  the  terms  of  reference  of  matters  to 
special  committees  clear — and  a  time  limit  set  in  which  to  report 
back.  Especially  where  grievances  are  under  consideration,  time 
is  the  essence  of  the  difficulty  and  promptness  should  be  kept 
always  in  view. 

(k)  The  Conduct  of  Meetings. — Meetings  of  works  committees 
should  be  held  at  least  monthly,  and  provision  should  exist  for 
the  calling  of  special  meetings  in  the  interval  if  the  occasion 
demands. 

1  See  Chapters  XIX  and  XXIII. 


422  PERSONNEL  ADMINISTRATION 

Meetings  should  be  held  on  company  time,  preferably  in  the 
late  afternoon;  and  employees  should  be  reimbursed  at  their 
usual  rate  for  time  lost  from  work. 

The  costs  incident  to  meetings  should  be  met  by  the  company. 
And  a  place  for  holding  the  meetings  should  be  provided  by  the 
company. 

The  chairman  of  the  works  committee  should  be  selected  by 
that  committee.  The  device  of  having  each  side  choose  a 
chairman  and  having  them  preside  at  alternate  meetings  is 
sometimes  used.  The  use  of  the  personnel  manager  of  the  com- 
pany as  committee  chairman,  seems  to  us  to  be  only  desirable 
if  this  is  definitely  urged  by  the  employees  and  if  this  executive 
is  of  broad  enough  gauge  to  see  all  around  the  problems  which 
come  up.  We  incline  to  the  view  that  this  executive  can  per- 
form a  greater  service  to  all  parties  by  simply  being  one  of  the 
management  representatives  on  the  committee. 

In  the  case  of  the  company  council,  the  chairman  may  without 
impropriety  be  the  president  of  the  corporation;  in  which  event 
he  should  have  no  vote. 

(I)  Method  of  Voting. — Two  broadly  different  methods  of 
voting  on  committees  are  in  use:  The  majority  vote  of  each  side 
taken  in  separate  caucus  recorded  either  as  one  vote  or  as  the 
actual  number  of  votes;  and  the  majority  vote  of  the  whole 
committee.  The  reasons  urged  for  the  second  method  seem  to 
us  on  the  whole  to  outweigh  those  against  it. 

Many  of  the  questions  which  shop  committees  act  upon  do  not 
raise  sharply  issues  concerning  the  divergent  interests  of  managers 
and  men;  and  even  when  those  divergent  interests  do  have  to 
receive  attention,  a  proper  committee  procedure  can  assure  a 
fair  consideration,  especially  when  the  chance  for  appeal  exists. 
In  other  words,  it  is  desirable  to  get  a  judgment  based  on  the 
sum  of  individual  convictions,  on  the  assumption  that  every 
committtee  member  wants  to  see  the  right  thing  done.  A  simple 
majority  vote,  however,  will  not  be  of  greatest  value,  since  on  all 
shop  questions  it  is  desirable  to  establish  in  advance  an  approxi- 
mate unanimity  of  opinion.  We  favor  a  two-thirds  or  even  if 
possible  a  three-fourths  vote  as  necessary  to  pass  any  decision. 
In  this  way  prior  agreement  upon  a  course  of  action  helps  to 
assure  its  faithful  carrying  out  by  all. 

(m)  Referendum. — Some  more  or  less  organized  method  is 
needed  to  assure  that  workers  are  endorsing,  supporting  and 


METHODS  OF  SHOP  COMMITTEE  ORGANIZATION      423 

aware  of  the  activities  of  their  delegates.  Nothing  will  be 
more  fatal  to  a  plan  of  representation  than  to  have  the  workers 
continually  repudiating  the  decisions  of  their  representatives. 

In  any  case  the  minutes  or  decisions  of  the  meetings  of  the 
works  committee  should  be  printed  or  mimeographed  and  made 
available  for  all  employees.  On  matters  of  special  urgency,  a 
referendum  might  well  occur  at  the  discretion  of  a  two-thirds 
vote  of  the  works  committee.  And  delegates  should  be  urged 
both  to  report  at  informal  noon  departmental  meetings  back  to  the 
workers  and  thus  to  get  their  expression  on  matters  still  pending. 

(ri)  Arbitration. — There  should  be  a  defined  line  of  appeal  for 
all  controversial  matters  which  cannot  be  settled  in  the  depart- 
ment or  in  the  works  committee,  as  the  case  may  be.  This  line 
of  appeal  should  not  end  with  any  official  of  the  company.  It 
should  end  with  arbitration,  which  can  usually  be  arranged  by 
providing  an  arbitration  committee  of  three ;  one  from  the  man- 
agement, one  from  the  men,  these  two  to  pick  a  third,  outside 
individual. 

(o)  Discharge. — Between  the  Scylla  of  no  arbitration  and  the 
Charybdis  of  non-agreement  on  causes  for  discharge,  certain 
shop  organization  plans  are  in  a  precarious  position.  Resort 
to  an  outside  arbitrator  and  a  clearly  defined  list  of  jointly  agreed 
causes  for  discharge  are  essential  conditions  of  a  plan  which  is 
safe  and  fair  to  both  sides.  Some  of  the  plans  have  such  a  list 
of  causes  of  discharge,  but  the  list  is  so  formidable  that  one  sur- 
mises that  the  acquiescence  of  the  workers  was  only  nominal. 
The  better  way  is  to  provide  in  the  plan  that  a  number  of  causes 
for  which  discharge  without  notice  will  be  held  to  be  fair,  will 
be  decided  on  subsequently  by  the  works  committee.  Even 
in  these  cases,  however,  the  ordinary  line  of  appeal  should  be 
available  for  the  discharged  worker  who  believes  he  is  aggrieved ; 
the  review  in  such  a  case  to  be  on  the  facts. 

In  order  to  give  the  delegates  every  assurance  against  discrimi- 
nation because  of  their  activities  on  committees,  some  plans 
provide  an  appeal  directly  to  the  president  of  the  company  if 
such  representative  feels  himself  aggrieved.  This  is  an  excellent 
provision,  since  by  virtue  of  its  presence  in  writing  it  reduces  the 
likelihood  of  such  discrimination  taking  place. 

(p)  Adoption. — The  plan  as  finally  intended  for  operation 
should  be  submitted  in  writing  to  the  employees.  It  should  be 
accepted  by  at  least  a  two-thirds  vote  of  the  employees,  taken 


424  PERSONNEL  ADMINISTRATION 

not  less  than  a  week  after  the  plan  is  submitted  for  their 
consideration. 

(q)  Amendment. — Provision  for  amendment  of  the  plan  should 
not  be  too  rigid.  A  two-thirds  vote  of  the  works  committee  at 
the  first  meeting  after  an  amendment  has  been  proposed  and 
posted  on  the  department  bulletin  boards,  is  a  reasonable  condi- 
tion. 

(r)  Termination. — It  should  be  provided  that  the  plan  is  ter- 
minable only  on  six  months'  notice  by  a  majority  vote  of  the  em- 
ployees of  the  company,  or  of  the  Board  of  Directors. 

(«)  Enabling  Clause. — It  should  be  clearly  understood,  once 
a  course  of  action  is  decided  upon,  where  the  responsibility  rests 
for  its  execution.  Unless  such  responsibility  is  specifically 
delegated  to  some  special  group,  it  would  usually  devolve  upon 
the  management  to  carry  out  the  decisions.  This  will  be  espe- 
cially true  where  such  decisions  involve  production  policies.  It 
is,  therefore,  desirable  to  insert  in  the  plan  a  clause  to  the  effect 
that: 

"The  works  committee  shall  be  concerned  primarily  with  the 
shaping  of  policies.  When  the  policy  of  the  company  as  to  any 
of  these  matters  has  been  determined  upon,  its  execution  shall 
remain  with  the  management,  but  the  manner  of  that  execution 
may  at  any  time  be  a  subject  for  the  consideration  of  the  works 
committee." 

(0  The  Right  to  Facts. — Provision  should  also  be  clearly  made 
that  when  the  works  committee  is  asked  to  deliberate  and  de- 
cide upon  a  matter,  it  shall  have  access  to  the  facts  necessary  to 
an  intelligent  decision.  Unless  such  a  provision  is  made,  it  may 
be  difficult  to  persuade  certain  executives  that  they  should  make 
information  available.  One  of  the  first  conditions  of  successful 
employee  representation  is  that  committees  shall  have  access 
to  existing  facts  on  relevant  matters.  This  suggests  the  need  of 
an  agency  for  procuring  data  and  thoroughly  investigating  moot 
problems.  The  research  division  of  the  personnel  department 
can  well  be  this  agency. 

The  Technique  of  Committee  Action. — To  assure  successful 
operation  of  employee  representation  it  is  necessary  that  all  com- 
mittee action  proceed  in  an  effective  way.  The  importance  of 
understanding  the  technique  of  committee  work,  therefore, 
warrants  us  in  laying  down  a  few  simple  rules  born  of  experience. 
These  rules  apply  to  all  committee  action,  but  are  especially  im- 


METHODS  OF  SHOP  COMMITTEE  ORGANIZATION      425 

portant  for  special  standing  committees  which  are  aiways  in 
danger  of  wasting  time  by  futile  and  discursive  argument  and 
by  indecisive  and  foggy  deliberations. 

A  cardinal  principle  in  group  action  is  to  have  the  size  of  the 
group  adapted  to  the  function  which  it  is  to  perform.  The  usual 
function  of  committees  is  deliberation  in  common,  with  the  object 
of  deciding  upon  some  policy  or  course  of  action  to  be  pursued. 
A  meeting  of  minds  must,  in  order  to  eventuate  in  action,  be- 
come a  reasonable  harmony  of  minds  on  the  matter  in  hand. 
This  desirable  end  argues  for  having  deliberative  bodies  small,  a 
dozen  at  the  most  and  preferably  five  or  six  people. 

But  though  they  be  small,  committees  should  give  voice  to  the 
different  interests  involved.  The  case  for  joint  committees  on 
matters  of  any  importance  is  a  strong  one,  since  it  provides  at 
every  step  for  a  hearing  from  those  who  have  different  points  of 
view  about  a  problem  of  mutual  concern.  And  these  points  of 
view  must  be  reconciled  if  mutually  satisfactory  action  is  to  take 
place. 

In  addition  to  being  small  and  representative,  committees 
should  be  informed.  Members  should  be  selected  because  of 
their  interest  in  and  special  knowledge  of  the  subject  in  hand; 
and  committees  should  have  access  to  the  data  needed  as  the 
basis  for  wise  decision. 

This  need  of  data  points  to  the  need  of  leadership  and  over- 
sight over  committee  work.  The  personnel  department  should 
perform  this  necessary  supervisory  labor.  This  supervision  in- 
volves several  things. 

Meetings  should,  for  example,  be  called  often  enough  to  keep 
members  interested. 

Meetings  should  not,  however,  be  called  unless  there  is  some 
business  to  transact.  (This  does  not  apply  to  works  committees 
which  should  meet  monthly  and  consider  matters  which  will 
frequently  come  up  at  the  meeting  itself.) 

Meetings  should  be  planned  by  making  out  the  agenda  of 
topics  in  advance,  and  preferably  notifying  members  of  the 
agenda. 

Chairmen  should  be  coached  in  ways  of  drawing  out  the  dif- 
ferent points  of  view  and  of  shutting  off  discussion  which  wanders 
too  far  afield. 

As  said  above,  work  assigned  to  committees  should  be  clearly 
specified  and  a  time  limit  set  for  reporting  back. 


426  PERSONNEL  ADMINISTRATION 

Also,  it  should  always  be  remembered  that  if  a  committee  is 
made  responsible  for  the  execution  of  anything  (operating  a 
lunch  room,  running  a  dance  or  a  suggestion  system,  etc.)  the 
work  of  execution  has  to  be  done  by  some  specified  individual. 

Finally,  there  is  a  tendency  to  put  upon  committees  tasks 
which  require  elaborate  study — such  as  a  survey  of  the  local  cost 
of  living,  comparative  wage  rates,  etc.  If  committees  are  to  be 
asked  to  do  such  work,  they  should  be  provided  with  the  time 
and  the  necessary  expert  assistance  to  do  their  work  properly. 

In  short,  the  secret  of  the  successful  use  of  committees  is  to 
conduct  them  as  an  educational  force  with  an  educational  motive. 
Committees  of  workers  are  in  reality  conferences  of  people  who 
are  learning  how  to  carry  on  their  own  affairs.  If  this  fact  is 
borne  constantly  in  mind,  and  if  the  personnel  administrator  is 
at  pains  always  to  provide  these  groups  with  relevant  subject- 
matter,  committee  action  can  be  a  fruitful  source  of  personal 
development  and  of  group  morale.  Mr.  Graham  Wallas  puts 
his  conclusion  mildly  when  he  says,  it  is  "my  impression  that 
business  organization  might  often  gain  on  its  intellectual  side 
by  the  wider  adoption  of  means  for  concerted  discussion,  and  by 
a  close  examination  of  the  method  by  which  those  who  work  in 
a  small  section  of  the  business  can  be  induced  or  empowered  to 
think  about  the  business  as  a  whole."1 

The  Benefits  from  Shop  Committees. — Clearly,  therefore,  the 
educational  value  of  any  scheme  of  employee  representation  may 
be  primarily  urged.  "We  are  finding,"  says  one  of  the  high  ex- 
ecutives of  the  International  Harvester  Co.,  "  that  the  new  asso- 
ciation with  our  employees  is  the  best  thing  in  the  world,  not 
only  for  them  but  for  us  as  well.  We  are  taking  advantage  of 
that  old  saying,  'Get  acquainted  with  your  neighbor — you  might 
like  him.'  "» 

But  beyond  this  general  educational  value,  it  can  be  specific- 
ally said  that  committees  are  useful  because  they  acquaint  both 
sides  with  the  facts,  with  the  problems  which  confront  the  other 

1  WALLAS,  G.,  The  Great  Society.  Chapter  XI,  on  The  Organization 
of  Thought  deserves  careful  study  by  anyone  who  desires  to  sec  committee 
action  made  effective. 

1  Proceedings,  National  Association  of  Employment  Managers,  1919,  p. 
139. 


METHODS  OF  SHOP  COMMITTEE  ORGANIZATION      427 

side,  with  the  point  of  view  of  the  other  side  and  with  the  inten- 
tions of  the  other  side.  In  all  of  this  there  is  a  distinct  gain. 
In  the  address  just  quoted,  Mr.  McCormick  cites  a  case  in  one  of 
their  plants  where  a  group  of  100  workers  were  working  seven 
days  a  week,  twelve  and  a  half  hours  a  day.  And  the  responsible 
management  did  not  know  this  until  one  worker  complained  to 
the  committee  and  it  was  stopped.  He  also  related  how  a  de- 
mand for  a  general  wage  increase  was  voluntarily  withdrawn  as 
soon  as  the  management  showed  the  books — "the  ledgers  which 
before  had  been  regarded  as  sacred" — and  the  workers  saw  the 
management's  problem  in  the  existing  financial  condition. 

Because  these  activities  are  educational  they  provide  also  a 
training  ground  for  leadership  and  responsibility  among  the 
workers.  All  the  evidence  at  hand  indicates  that  if  employees 
know  the  true  facts,  they  will  be  as  responsible  in  their  decisions 
as  could  be  desired.  Mr.  Dale  Wolf  in  recounting  his  work  with  a 
large  corporation,  gives  an  interesting  (and  by  no  means  unique) 
illustration  of  how  the  company  when  it  was  faced  with  a  grave 
slump  in  demand,  called  in  its  workers  and  gave  them  a  careful 
statement  of  the  whole  market  situation.  The  workers  were 
asked  what  their  suggestions  would  be  under  the  circumstances 
and  the  committee  after  a  canvass  of  the  plant  finally  decided  on  a 
temporary  radical  reduction  of  hours  for  all  employed.1 

Responsibility  is  traditionally  sobering;  and  the  fear  that 
"agitators"  and  hot-heads  will  stampede  the  workers  into  in- 
discreet decisions  is  not  justified  by  recent  experiences.  Indeed 
if  anything,  the  danger  is  the  other  way — that  workers  will 
assume  responsibility  for  conditions  which  can  really  be  laid  at 
the  door  of  inefficient  management. 

Moreover,  the  value  of  employee  representation  as  a  stimulus 
to  production  is  widely  testified  to.  Mr.  Leitch's  experience  is 
full  of  such  testimony;2  and  the  following  citations  do  not  come 
from  isolated  cases.  "The  unexpected  and  indirect  results  of 
our  labor  policy  in  increasing  efficiency  .  .  .  (have)  been  as 
profitable  and  satisfactory  as  the  direct  result."3  "Since  the 
introduction  of  this  plan,  we  have  by  request  of  the  workers 
themselves  reduced  the  working  hours  from  53  to  50  per  week, 

1  See  WOLF,  DALE.     Successful  Industrial  Democracy.     (In  Industrial 
Management,  July,  1919,  p.  70.) 

2  See  LEITCH,  JOHN.     Man  to  Man. 

3  Hart,  Schaffner  &  Marx,  quoted  in  WOLFE,  A.  B.,  Works  Committees 
and   Joint  Industrial  Councils,  page  137.     This  plant,  however,  combines 
shop  committees  with  collective  bargaining. 


428  PERSONNEL  ADMINISTRATION 

with  an  increased  production  and  increased  earnings  as  the 
result.  .  .  ."' 

"You  may  ask  why  I  say  that  employee  representation  in- 
creases the  efficiency  of  a  business.  Well,  I  can't  give  you  statis- 
tics, but  we  see  the  steady  rise  of  the  efficiency  of  each  and  every 
one  of  our  departments."2  "Fifty-five  per  cent,  of  the  factories 
reported  that  the  plan  had  stimulated  production."3 

These  citations  may  not  present  a  true  picture  of  every  plant 
where  shop  committees  function.  But  they  do  tend  to  bear  out 
the  conclusion  reached  earlier  in  our  study  that  employees' 
efficiency  is  determined  by  their  interest,  and  that  interest  is 
secured  by  some  approximation  to  self-determination  in  work, 
chance  for  the  approval  of  one's  fellows,  chance  for  the  conscious 
exercise  of  fellowship,  chance  to  see  some  significance  in  one's 
labors.  Employee  representation  contributes  to  all  of  these  ends 
in  one  way  or  another;  and  thus  appears  rightly  to  be  one  essential 
step  in  procuring  efficient  managerial  organization. 

It  is  further  true  that  committee  action  tends  to  relieve  the 
management  of  the  consideration  of  a  certain  number  of  relatively 
minor  maladjustments,  grievances  and  complaints  which  should 
be  handled  promptly,  at  first  hand,  by  those  actually  im- 
plicated. The  boast  of  some  executives  that  "my  door  is 
always  open  to  anyone  who  wants  to  seen  me,"  is  well  meant. 
But  it  points  to  two  real  defects.  First,  it  assumes  that  individ- 
ual workers  will  have  the  initiative  and  take  the  risk  of  "coming 
out  front  to  raise  a  row."  And,  second,  it  indicates  that  provi- 
sion has  not  been  made  for  handling  at  the  proper  place  and  in  a 
democratic  way,  complaints  that  may  arise. 

Again,  it  is  probably  true  (although  it  is  yet  too  early  to  gen- 
eralize) that  employee  representation  reduces  strikes.  It 
certainly  tends  to;  and  has  in  numerous  instances  averted  them. 
But  the  claim,  important  as  it  is,  must  be  advanced  with  caution. 

There  is  another  value  in  employee  organization  in  relation  to 
esprit  de  corps,  morale  and  loyalty.  Each  of  these  words 
connotes  something  which  is  essential  in  every  factory  if  it  is  to 
operate  harmoniously  and  productively.  Yet  each  word  is  used 

1  William  Demuth  &  Co.,  quoted  in  WOLFE,  A.  B.,  op.  tit.,  page  228. 

1  International  Harvester  Co.  See  Proceedings,  National  Association  of 
Employment  Managers,  1910,  p.  138. 

1  Western  Efficiency  Society,  Questionnaire  on  Employee  Representation 
in  Factory  Management. 


METHODS  OF  SHOP  COMMITTEE  ORGANIZATION      429 

today  in  a  rather  loose  way  to  indicate  a  desire  for  the  uncritical, 
passive  and  complete  submission  of  workers  to  the  desires  of 
management.  If  this  submission  is  loyalty,  it  is  clear  that 
industry  does  not  really  want  it.  That  kind  of  abject  obedience 
is  no  longer  desirable  or  possible.  Committee  action  of  all  kinds 
emphasizes  the  simple  truth  that  satisfactory  relations  involve 
reciprocal  obligations.  In  its  essence,  joint  conference  assumes 
and  requires  reciprocal  responsibilities — which  is,  indeed,  one  of 
the  chief  reasons  why  we  stress  the  joint  feature.  Joint  confer- 
ence has  in  it  the  possibility  of  creating  a  consciousness  in  the 
management  of  its  responsibilities — which  is  the  necessary  condi- 
tion of  securing  true  "company  loyalty."  An  esprit  de  corps 
which  is  to  have  any  permanency  must  in  this  day  make 
a  sincere  appeal  to  self-respect  and  personal  dignity.  And  on 
both  sides  that  sense  of  self-respect,  dignity  and  reciprocal  obliga- 
tion is  fostered  by  employee  participation  in  shop  control. 

This  idea  is  well  presented  in  two  excellent  definitions  which 
are  in  point  here.  "Industrial  goodwill,"  says  a  careful  student  of 
industry,  "is  not  necessarily  a  virtuous  will  or  a  loving  will;  it  is  a 
beneficial  reciprocity  of  wills."  And  company  loyalty  he  charac- 
terizes as  not  "gratitude  for  past  favors  nor  a  sense  of  obligation 
but  an  expectation  of  reciprocity."1 

"There  is  a  conception  going  the  rounds  of  industry  today 
that  morale  is  something  that  can  be  bought,"  says  one  of  the 
most  successful  labor  administrators  in  the  country;  "that  it  can 
be  picked  up  from  the  shelf  somewhere  and  placed  where  it  is 
desired.  .  .  .  But  morale  is  always  a  result  of  right  thoughts, 
right  actions  and  wholesome  environments."2 

And  Robert  G.  Valentine  put  the  matter  plainly  but  truthfully 
when  he  said  that  "Employers  should  stop  talking  about  the 
loyalty  of  their  employees  until  they  are  ready  to  make  an  equal 
noise  talking  about  their  loyalty  to  employees." 

Another  value  of  shop  committees,  less  directly  economic  but 
destined  to  carry  more  and  more  weight,  is  the  value  of  experience 
in  political  activity  which  any  genuine  employee  representation 
scheme  affords.  It  has  been  well  said  that  "no  concern  can  be 
allowed  to  take  a  worker's  time  for  eight  or  nine  hours  a  day  with- 
out providing  opportunity  for  him  to  practice  actual  methods  of 

1  COMMONS,  J.  R.     Industrial  Goodwill,  p.  150. 

2  GRIEVES,    W.   A.     Proceedings,    National  Association  of  Employment 
Managers,  1919,  p.  84. 


430  PERSONNEL  ADMINISTRATION 

government"  (R.  G.  Valentine).  We  live  in  a  political  democ- 
racy; yet  that  democracy  can  only  be  made  actual  if  its  citizens 
have  the  competence  and  the  experience  in  deciding  public  issues 
which  comes  with  practice.  And  shop  committees  do  provide 
a  certain  amount  of  experience  in  group  activity  which  has  its 
value  for  America's  political  no  less  than  for  its  industrial  future. 

Finally,  it  should  be  understood  that  the  personal  associations 
between  executives  and  workers,  built  up  in  the  joint  groups,  can 
count  for  much  in  helping  the  company  to  ride  smoothly  into 
negotiations  with  labor  unions  if  such  collective  dealings  become 
imminent.  If  the  time  has  arrived  when  collective  bargaining  is 
seen  to  be  inevitable,  it  is  a  mistake  to  incur  ill-will  and  an  aliena- 
tion of  personal  understandings  with  employees  by  obstinate 
resistance.  Rather  is  it  policy  to  utilize  to  the  full  the  cordiality 
which  already  exists,  to  make  the  transition  as  amicable,  reason- 
able and  mutually  satisfactory  as  possible. 

Moreover,  there  is  this  important  consideration.  The  activi- 
ties of  a  union's  business  agent  in  intra-plant  affairs  arc  likely 
to  be  in  proportion  to  the  amount  of  outside  protection  which 
the  employees  find  that  they  need.  If  within  the  plant,  agencies 
exist  which  reduce  friction  and  minor  grievances  to  a  minimum, 
there  is  little  point  in  the  constant  presence  of  the  business  agent. 
And  in  the  long  run  he  has  found  this  freedom  from  shop  quarrels 
to  be  as  much  to  his  advantage  as  to  the  company's,  since  there 
are  many  extra-plant  affairs  which  can  better  receive  his  attention. 

Shortcomings  of  Shop  Committees. — The  reasons  advanced  by 
the  American  Federation  of  Labor  for  their  opposition  to  plans  of 
employee  representation  fostered  by  employers  are  by  no  means 
applicable  to  all  existing  plans;  nor  are  they  conclusive  since 
they  view  the  matter  from  one  point  of  view  only.  However, 
their  underlying  contention  has  considerable  force  and  must  be 
frankly  faced.  Their  objection  is  that  intra-plant  organization 
does  not  of  itself  assure  equal  bargaining  power.  The  employer 
in  the  event  of  a  strike  can  send  goods  to  other  plants  to  be  made; 
he  can  get  extension  of  his  credits;  he  can  sometimes  get  the 
financial  support  of  fellow-employers.  The  worker  under  an 
employee  representation  plan  cannot,  if  he  is  dissatisfied  with 
conditions  as  finally  determined  under  the  plan,  easily  do  any 
of  these  things.  It  is  difficult  for  him  to  move  to  another  job; 
his'  grocery  bills  come  due  every  week;  he  has  no  strike  benefits 
coming  to  him. 


METHODS  OF  SHOP  COMMITTEE  ORGANIZATION      431 

The  parties  are  equal  under  a  shop  committee  only  so  long  as 
the  management  does  not  dissent  too  strongly  from  compliance 
with  those  demands  in  which  the  workers  see  justice  embodied. 
Once  he  gives  a  positive  "No"  and  his  workers  strike  in  protest, 
the  employer  is  economically  in  the  stronger  position.  This  in- 
equality is  surely  less  marked  when  the  workers  are  affiliated 
with  their  fellows  in  other  shops  and  have  an  organization  with 
strike  benefits  and  a  follow-up  to  prevent  work  being  diverted 
into  other  shops.  Question  still  may  arise  as  to  whether  there 
should  be  equal  bargaining  power — we  shall  consider  this  in 
Chapter  XXXI.  But  on  the  assumption  (which  the  A.  F.  of  L. 
makes)  that  such  equality  is  desirable,  works  committees  surely 
do  not  secure  it. 

"The  employer's  goodwill,"  as  someone  has  said,  "is  no  sound 
basis  for  collective  action."  Yet  most  of  the  existing  plans 
depend  absolutely  on  the  employer's  pleasure  for  their  continu- 
ance. "The  Lord  giveth,  the  Lord  taketh  away" — is  presum- 
ably the  philosophy  which  the  employee  is  to  adopt.  Other 
plans  provide  for  possible  termination  after  six  months'  notice  by 
employees  or  board  of  directors.  It  seems  reasonable  to  conclude, 
therefore,  that  there  is  need  for  some  organization  which  exists 
independently  of  the  will  of  the  board  of  directors — or  even  of 
the  will  of  those  employees  who  fail  to  see  the  need  for  organized 
action  and  self-protection.  There  is  eventually  need  for  an 
employees'  body  acting  on  its  own  account  and  in  its  own  right. 
This  may  seem  an  academic  distinction  to  some;  but  in  reality 
there  is  a  world  of  difference  between  committees  which  exist 
on  the  sufferance  of  the  management  and  those  which  are  self- 
initiated  and  self-perpetuating. 

A  further  aspect  of  the  question  of  equality  in  bargaining  power 
is  the  difficulty  of  getting  sufficiently  able  representation  of  the 
workers'  case  from  among  the  employees.  There  is  a  serious 
danger  that  firms  which  are  using  their  shop  committees  merely 
as  a  "safety-valve,"  will — to  put  it  plainly — impose  upon  the 
'ignorance  of  their  employees  regarding  conditions  in  the  industry 
as  a  whole  and  regarding  all  the  other  important  factors  about 
which  the  workers  have  no  first  hand  knowledge. 

Even  when  no  such  deliberate  intention  is  present,  it  will 
still  be  true  that  workers  are  not  always  qualified  adequately 
to  uphold  their  end  of  the  argument  against  a  competent  manager 
who  knows  what  he  wants.  That  this  is  a  real  danger  with  the 


432  PERSONNEL  ADMINISTRATION 

rapid  spread  of  the  committee  movement,  cannot  be  too  strongly 
urged.  And  if  executives  are  found  to  be  discouraged  because 
employees  do  not  adhere  to  the  decisions  of  their  committee-men, 
we  must  be  sure  that' such  executives  are  not  practicing  a  mild 
form  of  hypnosis  on  the  delegates,  and  are,  therefore,  themselves 
the  cause  of  the  breach  between  the  representative  and  those 
whom  he  represents.  There  is,  it  may  be  fairly  said,  no  sufficient 
assurance  in  the  type  of  committee  plan  here  being  considered, 
that  the  employees'  side  will  be  presented  with  sufficient  ability, 
insight  and  power  to  warrant  adequate  and  intelligent  protection 
of  their  interests. 

A  second  shortcoming  in  the  shop  committee  plan  as  such,  is 
that  there  is  no  organization  among  the  employees  of  the  shop 
as  a  whole.  There  is  only  a  representative  machinery.  Direct 
democracy  in  the  town  meeting  sense  is  indeed  impossible  in  a 
plant  where  thousands  are  employed.  But  that  there  is  a  psy- 
chological value  in  having  the  representation  exist  within  an 
organization  inclusive  of  all  employees  we  strongly  believe.  This 
idea  is  developed  in  the  next  chapter. 

A  third  shortcoming  is  to  our  minds  a  fundamental  one.  There 
will  be  problems  and  influences  which  are  of  great  importance  in 
their  effect  upon  the  plant,  but  which  are  outside  the  control 
of  either  party  in  the  plant.  Yet  they  are  problems  which  the 
organized  employers  or  the  organized  workers,  or  both  together, 
could  to  a  large  extent  cope  with.  Such  are  problems  of  purchase 
of  raw  stock,  foreign  selling,  technical  research,  use  of  harmful 
processes,  uniform  cost  keeping,  etc.  If  "industrial  democracy" 
is  a  matter  of  one  factory,  it  will  stand  impotent  before  a  thousand 
exigencies.  The  employer  will  plead  his  helplessness;  the  facts 
will  show  his  ineffectuality.  But  self-government  in  industry 
is  fundamentally  a  matter  of  wider  scope  and  content;  indeed 
to  use  the  term  "industrial  democracy"  in  relation  to  one  plant 
is  seriously  misleading.  For  democracy  in  industry  nn-.-uis 
nothing  if  it  does  not  mean  scientific  control  over  the  economic 
organization  of  a  country  (and  internationally  as  well)  under  the 
direction  of  the  actual  head  and  hand  workers  and  in  the  public 
interest. 

We  are  not,  of  course,  claiming  that  shop  committees  are  to  be 
criticized  for  not  doing  something  which  by  their  nature  they 
cannot  do.  It  is  rather  that  we  are  calling  attention  to  the 
limit  to  their  function  which  is  rightfully  imposed  by  their  re- 
stricted make-up.  For  that  limit  is  in  actual  practice  quickly 


METHODS  OF  SHOP  COMMITTEE  ORGANIZATION      433 

reached.  What  can  a  joint  shop  committee  do,  for  example, 
to  offset  the  results  of  the  unfair  competition  of  another  plant 
which  misbrands  or  adulterates  its  product;  what  can  be  done 
to  prevent  a  corner  in  raw  materials,  or  to  remedy  an  absence  of 
cost  keeping  records  by  competitors  which  results  in  their  under- 
bidding a  fair  price?  These  are  questions  vital  to  the  welfare 
of  the  management  and  the  employees  of  any  plant;  yet  they  are 
not  met  without  industry-wide  action.  The  factory  committee 
is  competent  to  deal  with  factory  problems.  Only  a  representa- 
tive body  from  the  entire  industry  is  ultimately  competent  to 
control  the  really  vital  factors. 

These  shortcomings  are  not,  however,  of  a  character  to  hinder 
the  usefulness  of  the  shop  committee  provided  its  use  is  confined 
to  those  functions  which  it  is  competent  to  exercise;  provided  its 
advocates  do  not  make  claims  which  it  is  impossible  for  it  to 
realize;  provided  it  is  used  not  as  a  substitute  for  more  compre- 
hensive organization  in  an  industry,  but  as  its  necessary 
complement. 

Employers'  Objections. — The  objections  to  shop  committees 
which  were  current  before  the  war  have  lost  much  of  their  appeal 
in  the  light  of  recent  experience.  The  objection,  for  example, 
that  they  tend  to  reduce  output  is  not  substantiated  by  the  facts. 
The  objection  that  they  force  up  wages  is  certainly  not  as  abso- 
lutely true  as  was  supposed. 

It  is  interesting  in  this  connection  to  see  on  what  matters  these 
bodies  do  deliberate.  Some  approximate  figures  have  been  sup- 
plied by  different  firms.  "We  had,"  says  the  Bethlehem  Steel 
Company,  "ten  committee  classifications,  the  first  was  employ- 
ment and  working  conditions.  Thirty  per  cent,  of  all  the  250 
cases  fell  within  that  scope.  Twenty  per  cent,  came  within  the 
scope  of  wages,  hours  of  work,  bonus,  etc.,  ....  10  per  cent, 
under  health  and  works  sanitation,  10  per  cent,  on  employes' 
transportation,  10  per  cent,  practice  methods  and  economy  .  .  'u 

The  Standard  Oil  Company  of  New  Jersey  out  of  119  items 
taken  up  in  a  year  found:  Wages  38%  of  the  items,  working 
conditions  10%,  promotions  and  discharge  9%,  hours  8.5%, 
methods  of  wage  payment  8%,  etc.2  The  fact  is  that  con- 
sideration of  the  wage  rates  occupies  an  important,  but  by  no 

ILAKKIN,  J.  G.  Proceedings,  National  Association  of  Employment 
Managers,  1919,  p.  125. 

2  New  York  Times,  May  25,  1919. 

28 


434  PERSONNEL  ADMINISTRATION 

means  a  preponderant  place,  in  committee  discussions.  And 
far  from  evidencing  a  tendency  to  demand  unreasonable  increases, 
all  the  facts  show  a  disposition  on  the  workers'  part  to  act  re- 
sponsibly once  the  financial  condition  of  the  company  is  fully 
appreciated.* 

The  objection  is  also  advanced  that  the  employees  who  are 
selected  by  their  fellows  are  irresponsible, — are  the  "loud- 
talkers"  and  "agitators."  Here  again,  experience  does  not  bear 
out  the  contention.  And  even  where  there  is  a  tendency  not  to 
select  just  the  right  type  of  delegate  at  first,  employees  find  after 
one  election  that  in  any  battle  of  wits,  they  must  choose  their 
best  talent  to  represent  them.  On  this  point  the  Harvester 
Company  testifies  to  "what  a  fine  type  of  men  the  employees 

have  elected  as  their  representatives the  men  were  of 

an  average  age  of  37  years,  three-quarters  of  the  representatives 
married,  the  average  employment  with  the  company  is  over  7 
years,  and  a  large  number  of  them  own  their  own  home  or  stock 
in  the  company."2 

Similar  in  character  is  the  objection  that  employees  will  not 
assume  responsibility.  The  evidence  already  cited  would  seem 
to  be  sufficient  proof  that  this  generalization  is  slightly  over- 
drawn; and  that  where  it  is  true,  the  management  has  not  prop- 
erly reciprocated  by  assuming  its  own  responsibilities.  Macaulay 
has  a  few  wise  words  which  are  especially  pertinent  in  this  con- 
nection. "Many  politicians,"  he  says,  "are  in  the  habit  of  laying 
it  down  as  a  self-evident  proposition  that  no  people  ought  to  be 
free  till  they  are  fit  to  use  their  freedom.  The  maxim  is  worthy 
of  the  fool  in  the  story,  who  resolved  not  to  go  into  the  water  till 
he  had  learned  to  swim.  If  men  are  to  wait  for  liberty  till  they 
become  wise  and  good  in  slavery,  they  may  indeed  wait  forever."3 

The  objection  that  the  committee  interferes  with  the  manage- 
ment's prerogative  to  run  the  business  the  way  it  wants  to,  is  a 
valid  one.  We  have  no  desire  to  obscure  this  fact.  The  manager 
who  holds  that  "this  is  my  business,  to  run  as  I  see  fit, "  had  best 
leave  shop  committees  alone.  But  when  after  experiencing  the 

1  Sec  also  in  this  connection  the  thoughtful  statement  of  the  vice-president 
of  the  Greenfield  Tap  and  Die  Corporation,  Industrial  Management,  July, 
1919,  p.  28. 

1  MrCoRMiCK,  CTRUS,  JR.  Proceeding*,  National  Association  of  Em- 
ployment Managers,  1919,  p.  13S. 

*LORD  MACAULAY.  Essay  on  Milton,  quoted  in  The  Nation  (English), 
July  5,  1919. 


METHODS  OF  SHOP  COMMITTEE  ORGANIZATION      435 

workers'  decreasing  interest  in  "my  business,"  such  a  manager 
concludes  that  "something  must  be  done,"  he  will  do  well  to 
consider  the  utility  of  some  form  of  employee  representation. 

Finally,  there  is  the  objection  that  "all  this  committee  business 
means  too  much  talk  and  takes  too  much  time."  Committee 
action  does  take  talk  and  time.1  All  education  takes  talk  and 
time  and  executive  supervision.  There  are,  of  course,  degrees 
of  efficiency  in  committee  work,  but  it  is  expensive  at  best. 
The  question  is:  Is  it  more  expensive  than  the  alternatives  of 
non-interest,  indifference,  and  no  esprit  de  corps'?  To  this  the 
answer  which  experience  is  giving  is  a  fairly  decisive  negative. 
And  that  negative  is  likely  to  become  even  clearer,  as  soon  as 
managers  plan  educational  and  administrative  work  on  a  basis 
of  reasonably  long  time  units.  The  cry  for  quick  results  in  a 
matter  involving  the  leveling-up  of  the  intelligence  or  compe- 
tency of  a  large  group  of  people,  is  born  of  a  failure  to  face  the 
facts.  Factory  administration  makes  headway  in  the  direction 
of  an  effective  and  smooth-running  productive  organism  only  as 
every  individual  involved  is  functioning  fully  and  happily. 
To  bring  this  about  is  not  the  work  of  a  day  or  even  a  year. 
"If  you  would  love  mankind,"  observed  an  English  statesman 
whose  life  was  filled  with  the  toilsome  effort  of  leading  represen- 
tative bodies  into  ways  of  wisdom,  "you  must  not  expect  too  much 
from  them." 

There  are  hopeful  signs  that  the  use  of  employee  representation 
will  prove  a  permanent  asset  for  sound  shop  organization.  If 

1  In  this  connection  the  following  paragraph  from  MILL'S  Representative 
Government"  is  too  pertinent  to  exclude:  "Representative  assemblies  are 
often  taunted  by  their  enemies  with  being  places  of  mere  talk.  .  .  .  There 
has  seldom  been  more  misplaced  derision.  I  know  not  how  a  representative 
assembly  can  more  usefully  employ  itself  than  in  talk,  when  the  subject 
of  talk  is  the  great  public  interests  of  the  country,  and  every  sentence 
of  it  represents  the  opinion  either  of  some  important  body  of  persons  or 
of  an  individual  in  whom  some  such  body  have  reposed  their  confidence. 
.  .  .  Such  'talking'  would  never  be  looked  upon  with  disparagement  if 
if  were  not  allowed  to  stop  'doing;'  which  it  never  would,  if  assemblies  knew 
and  acknowledged  that  talking  and  discussion  are  their  proper  business,  while 
doing,  as  the  result  of  discussion,  is  the  task  not  of  a  miscellaneous  body, 
but  of  individuals  specially  trained  to  it;  that  the  fit  office  of  an  assembly  is 
to  see  that  those  individuals  are  honestly  and  intelligently  chosen,  and 
to  interfere  no  further  with  them,  except  by  unlimited  latitude  of  sugges- 
tion and  criticism,  and  by  applying  or  withholding  the  final  seal  of  national 
assent." 


436  PERSONNEL  ADMINISTRATION 

only  at  every  step  managers  will  hold  before  themselves  the  educa- 
tional motive  and  the  principle  of  functional  organization, 
progress  will  be  assured.  The  shop  committee  has  an  indis- 
pensable function.  It  opens  up  channels  of  direct,  per- 
sonal communication  between  managers  and  managed.  A 
personal,  human  contact  is  established.  A  vivid  sense  of 
participation  in  a  common  and  socially  valuable  enterprise  is 
realized.  An  atmosphere  of  goodwill  and  workmanship  can 
thus  be  created,  which  is  the  atmosphere  needed  to  assure  true 
efficiency.  And  there  is  valuable  training  in  common  action  and 
decentralized  responsibility. 

But  genuine  industrial  democracy  requires  the  inclusion  of 
activities  over  a  wider  radius  and  circumference.  Other  func- 
tions besides  shop  representation  remain  to  be  provided  for. 
In  subsequent  chapters  we  shall  consider  how  the  larger  issues 
of  industial  relations  are  today  being  viewed  and  handled  in  a 
number  of  industries. 

Selected  References 

ABORN,  W.  G.  and  W.  L.  SHAFER.  Representative  Shop  Committees. 
(In  Industrial  Management,  v.  58,  pp.  29-32,  July,  1919.) 

BASSETT,  W.  R.  When  the  Workmen  Help  You  Manage.  N.  Y., 
Century  Co.,  1919. 

BLOOUFIELD,  MEYER.  Workshop  Committees.  (In  his  Management 
and  Men,  1919,  pp.  646-571.) 

BUREAU  OF  INDUSTRIAL  RESEARCH,  NEW  YORK  CITY.  American  Com- 
pany Shop  Committee  Plans.  N.  Y.,  pub.  by  Bureau,  1919.  Selected 
References  p.  37. 

BUREAU  OF  INDUSTRIAL  RESEARCH.  Industrial  Council  Plan  in  Great 
Britain.  N.  Y.,  pub.  by  Bureau,  1919. 

COLE,  G.  D.  H.  Self  Government  in  Industry.  London,  G.  Bell  <fc 
Sons,  1917. 

FORSTER,  H.  W.  Cooperation  with  Employees.  Philadelphia,  In- 
dependence Bureau,  1919. 

GARTON  FOUNDATION.  Industrial  Council  for  the  Building  Industry. 
London,  Harrison  &  Sons,  1919. 

GARTON  FOUNDATION.  Memorandum  on  the  Industrial  Situation  after 
the  War.  Philadelphia,  V.  S.  Shipping  Board,  Emergency  Fleet 
Corporation,  1918.  English  ed.,  Oct.,  1916. 

GLEAHON,  ARTHUR.  The  Discovery;  an  Account  of  a  New  Way  to  Industrial 
Pence  in  Great  Britain.  (In  Purvey,  v.  38,  pp.  150-159,  May  19,  1917.) 

GLKASON,  Arthur.  Whitley  Councils.  (In  Survey,  v.  42,  pp.  27-28,  75-77, 
109-1 11,  April  5-19,  1919.) 

GREAT  BRITAIN  MINISTRY  OFLABOUR.  Report  of  an  Enquiry  as  to  Works 
Committees.  Philadelphia,  I'.  8.  Shipping  Board,  Emergency  Fleet 
Corporation,  1919.  Original  English  ed.,  March.  1918. 


METHODS  OF  SHOP  COMMITTEE  ORGANIZATION      437 

GREAT  BRITAIN  MINISTRY  OF  RECONSTRUCTION.  Interim  Report  of  the 
Reconstruction  Committee  on  Joint  Standing  Industrial  Councils, 
(In  TJ.  S.  Bureau  of  Labor  Statistics,  Bui.  237,  1917,  pp.  229-25.) 

HODGES,  FRANK.  Workers'  Control;  the  Case  for  Self-Government  put 
Forward  by  the  British  Miners.  (In  Survey,  v.  43,  pp.  348-351, 
Jan.  3,  1920.) 

KELLOGG,  P.  V.  and  ARTHUR  GLEASON.  Self-Government  in  Industry. 
(In  their  British  Labor  and  the  War,  1919,  pp.  178-194.)  Also 
Industrial  Councils,  pp.  427-496. 

LEITCH,  JOHN.  Man  to  Man;  the  Story  of  Industrial  Democracy. 
N.  Y.,  B.  C.  Forbes  Co.,  1919. 

LEISERSON,  W.  M.  Employment  Management,  Employee  Representa- 
tion and  Industrial  Democracy.  Washington,  Govt.  Print.  Office, 
1919.  (U.  S.  Working  Conditions  Service  Bui.) 

MERRITT,  W.  G.  Factory  Solidarity  or  Class  Solidarity.  N.  Y.,  pub. 
by  Author,  1919.  (Reprint  from  Iron  Age.) 

METCALF,  H.  C.  Management  Sharing.  (In  National  Association  Cor- 
poration Schools.  Addresses,  reports,  etc.  4th  Annual  Convention 
May  30- June  2,  1916,  pp.  359-363.) 

NATIONAL  INDUSTRIAL  CONFERENCE  BOARD,  BOSTON.  Works  Councils 
in  the  United  States.  Boston,  pub.  by  Board,  1919.  (Research 
Report  No.  21.)  Bibliography  pp.  133-135. 

NEW  JERSEY  CHAMBER  OF  Commerce.  Shop  Committees  and  Industrial 
Councils.  (In  its  State  Research  Section,  New  Jersey,  v.  6,  sec.  2,  No. 
10,  July,  1919.) 

RENOLD,  C.  G.  Workshop  Committees.  N.  Y.,  Survey,  1918.  Reprint 
of  Survey,  \.  41,  No.  1.  Sup.  Oct.  5,  1918 

ROCKEFELLER,  J.  D.,  JR.  Representation  in  Industry.  (In  Annals, 
Amer.  Acad.,  v.  81,  pp.  167-181,  Jan.,  1919.) 

SPARKES,  MALCOLM.  Planning  the  New  Industrial  Order.  (In  World  To- 
morrow, v.  2,  No.  12,  pp.  320-326,  Dec.,  1919.) 

STODDARD,  W.  L.  The  Shop  Committee.  A  Handbook  for  Employer  and 
Employee.  N.  Y.,  Macmillau  Co.,  1919. 

TEAD,  ORDWAY.  Employees'  Organizations  and  Their  Helpful  Uses.  (In 
Industrial  Management,  v.  54,  pp.  249-256,  Nov.,  1917. 

TEAD,  ORDWAY.  Shop  Committees.  (In  New  Republic,  v.  19,  pp.  241- 
243,  June  25,  1919.) 

U.  S.  BUREAU  op  LABOR  STATISTICS.  Joint  Industrial  Councils  in  Great 
Britain.  Washington,  Govt.  Print.  Office,  1919.  (Bui.  No.  255.) 

U.  S.  BUREAU  OF  LABOR  STATISTICS.  Suggestions  as  to  Functions  and  Con- 
stitution of  District  Councils  and  of  Works  Committees.  (In  its 
-  Monthly  Labor  Review,  v.  8,  pp.  1342-1348,  May,  1919.) 

WALLAS,  GRAHAM.  Organization  of  Thought.  (In  his  Great  Society, 
1919,  pp.  235-286. 

WHITNEY,  ANICO  L.  Development  of  Shop  Committee  Systems.  (In 
U.  S.  Bureau  of  Labor  Statistics,  Monthly  Labor  Review,  v.  9.  pp.  1527- 
1535,  Nov.,  1919.) 

WOLFE,  A.  B.  Works  Committees  and  Joint  Industrial  Councils. 
Philadelphia,  U.  S.  Shipping  Board,  Emergency  Fleet  Corporation, 
1919.  Bibliography  pp.  248-254. 


CHAPTER  XXX 
EMPLOYEES'  ASSOCIATIONS 

The  fundamental  importance  of  organized  relations  between 
the  directive  force  and  the  manual  workers  has  never  been  better 
expressed  than  by  the  philosopher  who  said  that  "the  nature 
and  degree  of  authority  exercised  over  individuals,  the  distribu- 
tion of  power,  and  the  conditions  of  command  and  obedience  are 
the  most  powerful  of  the  influences,  except  their  religious  beliefs, 
which  make  them  what  they  are,  and  enable  them  to  become  what 
they  can  be." 

And  there  are  in  considering  employee  representation,  always 
two  distinct,  although  not  inseparable,  aspects  to  be  held  in  view 
— the  aspect  of  using  the  employee  organization  as  an  educational 
medium,  and  of  using  it  as  an  arrangement  for  conducting  the 
"collective  affairs  of  the  community  in  the  state  of  education  in 
which  they  already  are."1  Unless  both  are  borne  in  mind  and 
both  used  as  the  basis  for  specific  activities,  employees'  organiza- 
tions will  not  make  the  advances  nor  show  the  results  which  are 
rightly  to  be  expected  of  them. 

Values  of  an  Employees'  Association. — We  prefaced  our  dis- 
cussion of  shop  committees  by  asserting  that  the  form  of  organ- 
ization was  secondary  in  importance  to  the  spirit  animating  its 
operation.  It  is  nevertheless  true  that  there  are  better  and  worse 
forms  for  facilitating  the  expression  of  a  right  spirit.  One  objec- 
tion already  urged  to  the  committee  scheme  as  set  forth  in  the 
last  chapter  is  that  it  provides  only  a  representative  machinery. 
It  recognizes  no  formal  or  organized  body  politic  as  the  group  of 
primary  importance  which  is  represented.  There  is  simply  the 
committee  or  committees,  elected  out  of  the  departments  or 
divisions  of  the  shop.  There  is  no  organization  of  the  whole — of 
all  the  employees  of  the  plant.  If  we  bear  in  mind  that  organiza- 
tions of  different  size  are  needed  to  perform  different  functions 
successfully,  we  shall  realize  that  the  function  of  uniting,  of 
generating  and  sustaining  enthusiasm,  of  creating  morale  is  the 
function  of  a  relatively  large  body.  The  employees  as  a  whole 

1  MILL,  JOHN  STUART.     Considerations  on  Representative  Government. 

438 


EMPLOYEES'  ASSOCIATIONS  439 

in  their  organized  capacity  can  perform  this  function  better 
than  any  other  lesser  group.  They  can  become  the  will- 
organization  of  the  employees — that  is,  the  body  expressing  the 
will  and  desires  of  the  workers. 

Its  Structure. — We  therefore  favor,  especially  in  organizations 
where  the  employees  number  below  5000,  the  creation  of  an 
employees'  association  or  cooperative  association.  To  this 
association  every  employee  should  belong  either  by  virtue  of  the 
fact  of  his  employment  in  the  plant,  or  automatically  after  he  has 
been  employed  a  given  number  of  months.  This  association 
would  then  become  the  agent  of  the  workers  in  all  joint  dealings 
and  in  all  employee  activities.  Its  constitution  and  by-laws 
would,  as  was  the  case  with  shop  committees,  be  a  matter  for 
discussion  and  adoption  by  the  employees  themselves;  and  ob- 
viously many  of  the  principles  and  specific  provisions  would  be 
the  same  in  both  cases. 

Several  practical  points  of  difference  deserve  mention,  however. 
Shall  the  employees'  association  include  foremen,  office  workers 
and  executives?  In  practice  the  most  satisfactory  answer  to 
this  question  has  been  in  the  affirmative.  It  has  been  found  that 
there  is  a  real  value  in  having  all  workers  of  the  head  and  hand  in 
the  organization,  that  it  creates  a  spirit  and  a  sense  of  working 
partnership  which  are  beneficial.  It  will,  however,  be  wise  to 
provide  either  in  writing  or  in  the  unwritten  understanding  of 
the  plan,  that  the  number  of  foremen  and  other  executives  who 
can  hold  office  at  any  one  time  is  narrowly  limited,  or  that  foremen 
and  other  executives  are  not  eligible  at  all  for  the  higher  offices 
of  the  association,  and  that  the  idea  of  joint  representation  on  all 
important  committees  is  adhered  to. 

Actually,  of  course,  the  work  of  the  employees'  association  will 
be  largely  done  by  its  executive  committee.  This  committee 
(corresponding  in  structure,  function  and  method  of  election  to 
the  shop  committee  of  the  last  chapter)  should  be  representative 
of  departments  and  of  management  in  such  a  way  as  to  embody 
the  principle  of  equal  and  joint  representation.  And  similarly 
the  standing  committees  on  matters  of  mutual  interest  and  im- 
portance should  be  joint.  When,  however,  it  is  decided  to  turn 
over  to  the  association  various  employee  activities — benefit 
society,  athletics,  educational  work,  lunch  room,  etc. — the  prin- 
ciple of  equal,  joint  composition  is  less  vital. 

Not  the  least  useful  of  the  purposes  of  the  employees'  organiza-< 


440  PERSONNEL  ADMINISTRATION 

tion  should  be  to  administer  any  and  all  of  those  activities  which 
we  characterize  as  "service  features."  The  desirability  of  many 
service  features  is  to  be  measured  not  alone  by  their  intrinsic 
merit  but  by  the  extent  to  which  employees  are  willing  to  support 
and  help  administer  them  as  parts  of  the  employees'  association. 
For  example,  as  between  a  ball  field  bought  and  laid  out  by  the 
company  for  the  workers,  and  one  bought  by  the  employees' 
association  with  money  of  its  own  to  which  the  company  may  or 
may  not  have  added  a  contribution,  we  see  much  to  be  preferred 
in  the  latter  method.  And  an  employees'  society  creates  an 
instrument  for  that  kind  of  spontaneous  and  responsible  employee 
activity  which  is  not  so  well  fostered  in  any  other  way. 

Difference  between  Shop  Committees  and  Employees'  As- 
sociation.— It  may  be  said  that  an  employees'  association  really 
comes  to  the  same  thing  in  practice  as  a  shop  committee — espec- 
ially if  the  executive  committee  of  the  association  is  the  active 
body  and  if  actual  meetings  of  the  whole  association  are  infre- 
quent and  confined  to  "occasions"  rather  than  business  meetings. 
In  a  sense  this  is  true;  the  nominal  differences  appear  greater 
than  the  practical.  Yet  the  experience  of  well-run  employees' 
associations  substantiates  the  conclusion  that  there  is  a  subtle 
difference  in  attitude  and  in  morale  which  is  significant  and 
worth  preserving.  Employees  who  belong  to  an  employees' 
association  are  not  merely  "working  down  at  the  A.  B.  factory;" 
they  "belong  to  the  A.  B.  factory."  The  existence  of  anemploy- 
ees'  organization  capitalizes  the  fact  that  there  is  some  industrial 
body  to  which  each  worker  belongs;  and  that  organization  be- 
comes something  personal  and  intimate  if  it  is  dramatized  into 
an  employees'  association.  The  worker  does  not  usually  feel 
himself  a  member  of  the  corporation  for  which  he  works;  but  he 
can  be  a  member  of  the  association  of  all  its  active  workers. 
This  forms  a  psychological  point  of  contact  and  relationship, 
which,  slight  as  it  may  seem  from  the  point  of  view  of  committee 
methods,  is  genuine  and  helpful  from  the  point  of  view  of  mental 
methods — methods  of  securing  right  attitude  and  a  necessary 
and  legitimate  degree  of  loyalty  and  cooperation  of  employees  to 
the  enterprise. 

Details  of  Administration. — One  or  two  of  the  principles  laid 
down  regarding  shop  committees  apply  with  equal  force  here. 
An  employees'association  will  not  run  itself  successfully.  It  may 
not  spontaneously  develop  the  vitality  nor  the  reality  to  make  any 


EMPLOYEES'  ASSOCIATIONS  441 

one  in  the  organization  take  it  seriously.  It  needs  leadership. 
It  needs  executive  supervision  and  oversight.  It  needs  a  full 
recognition  by  the  management  that  it  is  an  educational  venture. 
This  means  that  not  only  a  personnel  executive  should  watch 
over  the  work  of  the  association,  but  that  in  a  plant  where  the 
number  of  activities  warrant  it,  an  executive  secretary  should  also 
be  employed  by  the  association  to  direct  its  work.  Preferably 
this  secretary  will  be  in  the  pay  of  the  association,  and  will 
be  selected  by  it. 

There  should  be  an  outright  grant  by  the  management  to  the 
association  of  a  given  amount  annually,  which  should  be  written 
off  to  educational  work.  And  the  salary  of  this  secretary  might 
be  paid  out  of  that  grant.  Whether  or  not  the  members  of  the 
association  should  pay  dues  is  a  matter  for  individual  decision  in 
each  individual  case;  although  where  there  are  benefit  features 
dues  will  be  required  as  a  matter  of  course.  Insurance  pre- 
miums excepted,  however,  we  would  not  urge  the  use  of  dues 
since  new  workers  may  feel  suspicious  of  charges  of  this  sort 
which  they  had  no  voice  in  incurring  and  have  no  way  of  avoiding 
short  of  leaving  the  job.  It  will  be  better  to  let  specific  activities 
finance  themselves  so  far  as  possible  out  of  the  fees  received  for 
values  given. 

We  have  assumed  that  the  employees'  association  is  interesting 
itself  largely  in  "service  activities."  But  as  long  as  its  interests 
are  thus  narrowly  restricted,  the  largest  values  will  be  ignored. 
It  is  as  true  of  employee  associations  as  of  shop  committees  that 
the  true  source  of  their  power  and  significance  lies  in  the  closeness 
of  their  relation  to  the  production  process.  This  is  to  be  achieved 
in  both  cases  by  the  use  of  job  analysis  and  wage  committees,  by 
departmental  production  conferences  and  the  other  means 
already  discussed. 

Again,  the  employees'  association,  if  it  takes  the  form  of  a 
"company  union, "  should  not  be  thought  of  by  the  management 
as  a  full  and  adequate  substitute  for  an  organization  of 
workers  inclusive  of  those  in  other  shops  in  the  same  industry. 
The  company  union  is  not  a  substitute  for  the  labor  union  for 
reasons  which  we  have  already  enlarged  upon.  It  is  a  body 
with  a  different  function  from  the  labor  union;  a  function 
necessary,  important,  conducive  to  mutual  understanding 
and  confidence.  As  an  administrative  area,  the  factory  has  its 
own  problems,  which  can  best  be  settled  within  that  limited 


442  PERSONNEL  ADMINISTRATION 

jurisdiction.  They  will  tend  to  be  settled  with  satisfaction 
to  all  under  the  common  deliberations  of  the  employees'  associa- 
tion. But  there  are  in  addition  problems  affecting  the  workers 
in  each  shop  which  are  not  confined  to  the  shop  in  their 
influence  and  effect,  and  for  these  a  larger  administrative  area 
of  control  has  been  found  increasingly  necessary. 

Moreover,  employers  must  not  let  the  name  "company 
union"  mislead  them  into  thinking  that  they  have  a  degree  of 
self-government  which  does  not  in  practice  exist.  "  Representa- 
tive institutions,"  says  Mr.  A.  E.  Zimmern,  "in  themselves  no 
more  ensure  real  self-government  than  the  setting  up  of  a  works 
committee  of  employees  in  a  factory  would  mean  that  the  work- 
men ran  the  factory.  The  distinction  between  representation 
and  effective  responsibility  is  constantly  ignored." 

The  company  union  is  a  means  of  securing  representation; 
but  as  it  is  usually  conceived,  it  is  not  a  responsible  administra- 
tive body  unless  there  are  express  grants  of  authority,  and 
where  such  grants  are  given  they  usually  pertain  to  relatively 
minor  matters.  This  is  not  said  by  way  of  disparagement. 
It  is  perfectly  legitimate  that  any  company  union  should  take 
on  responsibility  only  gradually;  but  meanwhile  the  employees 
are  likely  to  have  no  illusion  as  to  how  little  self-government 
really  exists. 

In  conclusion,  we  find  a  combination  of  an  employees '  associa- 
tion and  committee  groupings  to  be  useful  for  the  majority  of 
factories.  The  association  organizes  the  workers  and  gives 
them  a  sense  of  unity  and  cohesion.  The  committees  represent 
the  different  natural  groupings  of  the  workers  and  speak  for 
them  in  the  discussion  of  policies  and  in  decisions  about  methods. 
The  one  serves  the  factory  as  a  body  of  will.  The  others  are 
bodies  for  thought.  Both  are  needed;  both  already  exist  in 
many  plants  in  fact  if  not  in  name.  Together  they  create  the 
basic  factory  organization  on  which  can  be  safely  reared  the 
more  elaborate  developments  of  a  fully  representative  industrial 
structure. 

One  other  plan  of  factory  organization  requires  examination 
because  of  the  wide  attention  it  has  recently  received.  We 
have  already  referred  to  it  as  the  "federal  plan."1  The  essence 
of  this  plan  for  "industrial  democracy"  is  a  structure  of  repre- 

1  For  a  full  exposition  sec  LEITCH,  JOHN,  Man  to  Man.  See  also  the 
review  of  this  book  by  OROWAY  TEAI>  in  The  New  Republic,  July  16,  1919. 


EMPLOYEES'  ASSOCIATIONS  443 

sentation,  analogous  to  the  federal  government  of  the  United 
States.  The  executives  form  the  cabinet;  the  foremen  are  the 
senate;  the  workers  elect  a  house  of  representatives.  These 
bodies  meet  on  company  time  to  discuss  any  and  all  matters 
relevant  to  the  smooth  working  of  the  plant;  decisions  are 
executed  by  the  cabinet,  and  this  body  has  as  well  a  veto 
power  over  the  acts  of  the  other  two.  In  order  to  stimulate 
interest  in  economy  and  efficiency  an  "economy  dividend"  is 
paid  monthly  in  those  departments  which  cut  operating  costs. 
This  dividend  is  reckoned  on  a  basis  of  the  savings  in  cost 
between  present  unit  costs  and  previous  costs ;  of  which  savings 
50  per  cent  are  given  to  the  workers  who  helped  to  create  them. 

This,  briefly,  is  the  plan;  and  as  living  exponents  of  its  success, 
there  are  over  a  dozen  plants  in  which  it  has  operated  for  several 
years.  A  catalogue  of  its  points  of  merit  would  make  mention 
of  the  following  features :  It  is  concrete  in  the  kind  of  organiza- 
tion it  proposes.  The  plan,  because  of  the  analogy  to  the  fed- 
eral government,  appears  to  be  democratic;  and  therefore  has 
an  immediately  popular  appeal  to  both  sides.  Personal  contact 
between  managers  and  men  tends  to  be  re-established.  There  is 
a  cash  stimulus  to  efficiency.  And  finally,  and  most  important, 
the  necessity  for  organization  of  workers  and  of  organized 
relationship  with  them  is  recognized. 

If  the  plan  did  nothing  more  than  demonstrate  the  value  of 
group  action  and  of  creating  organized  channels  of  intercourse 
between  managers  and  men,  it  would  serve  a  worthwhile  pur- 
pose. And  it  is  undoubtedly  helping  to  transform  and 
humanize  the  thinking  of  the  employers  who  install  it. 

Nevertheless  from  the  point  of  view  of  a  close  study  of  the 
governmental  structure  of  industry,  the  plan  has  several  serious 
shortcomings.  First,  it  provides  for  no  joint  sessions.  This  is 
a  drawback  both  from  the  educational  and  administrative 
points  of  view.  There  is  value  in  having  the  other  side  hear  a 
case  stated  against  it;  but  there  is  little  to  be  gained  by  having 
each  problem  discussed  by  three  separate  bodies  none  of  which 
has  had  the  advantage  of  being  present  at  the  discussions  of  the 
other  two.  This  wastes  time  and  it  does  not  foster  understand- 
ing through  personal  association. 

No  provision  is  made  for  resort  to  arbitration  by  an  outside 
party.  If  there  are  any  serious  differences  between  executives 
and  workers,  the  cabinet  and  senate  can  easily  vote  down  the 


444  PERSONNEL  ADMINISTRATION 

workers  since  a  measure  must  pass  the  three  bodies  to  be 
adopted.  The  workers  have  thus  no  recourse  to  any  outside 
aid  or  advice.  The  company  has  the  services  of  Mr.  Leitch; 
and  his  personality  seems  to  be  an  important  factor  in  assuring 
stability  and  the  smooth  operation  of  the  plan.  Thus  the  ulti- 
mate voice  in  control  is  always  with  the  management. 

This  is  certainly  not  "industrial  democracy,"  although  presum- 
ably the  intention  of  a  progressive  plan  of  employee  representa- 
tion is  gradually  to  broaden  the  basis  of  control  and  responsibility 
so  that  it  no  longer  remains  solely  with  the  head  executive. 

This  points  to  the  most  serious  defect  of  all,  namely  the 
failure  of  the  scheme  to  define  the  fundamental  conditions  of 
industrial  democracy.  This  defect  is  seen  in  two  directions. 
First,  democracy  in  industry  requires  representation  of  all  the 
really  interested  parties  in  the  deliberative  body  which  deter- 
mines policy.  This  is  not  secured  under  the  "federal  plan" 
because  the  body  that  really  determines  policy  is  the  cabinet 
— that  is,  the  management.  Second,  democracy  in  industry, 
if  it  means  anything,  means  the  organization  of  the  industrial 
life  of  a  nation  as  a  whole,  for  the  avowed  purpose  of  public 
service,  on  a  basis  of  the  autonomous  control  of  each  industry 
by  those  within  that  industry  and  probably  with  the  title  to 
the  property  vested  in  the  community. 

The  conception  of  industrial  democracy  which  sees  no  further 
than  the  confines  of  one  shop  would  be  absurd  if  it  were  not 
so  prevalent.  The  good  is  in  danger  of  becoming  a  decided 
enemy  of  the  better  if  there  is  a  wide  extension  of  such  a  paro- 
chial plan  as  this  basically  is,  without  a  clear  understanding  of 
its  limitations.  It  cannot  be  said  that  any  plan  of  employee 
representation  as  yet  delays  a  time  of  wide  organization  and 
coming  together  among  employers  and  workers  in  a  whole  in- 
dustry, for  that  movement  is  proceeding  on  its  own  increasing 
momentum.  But  there  is  danger  that  shops  which  have  their 
thinking  too  rigidly  fixed  in  terms  of  factory  self-detcrmi nation 
will  be  slow  to  take  their  places  in  the  bigger  movements. 

It  is  not  difficult,  therefore,  to  account  for  the  present  popu- 
larity of  the  federal  plan.  It  is  only  nominally  democratic. 
It  assumes  a  complete  harmony  of  interests  and  a  permanent 
vesting  of  all  authority  just  where  it  now  is.  It  helps  to  create 
a  specious  company  loyalty  and  a  spirit  of  economy.  It  helps 
to  personalize  the  management's  thinking  by  stressing  the  fruit- 


EMPLOYEES'  ASSOCIATIONS  445 

ful  maxim  that  ''manufacturing  consists  in  making  men — they 
will  attend  to  the  product."  It  shows  the  value  of  employee 
organization  to  employer  and  employee. 

But,  after  all,  there  is  every  value  in  an  employee  association 
with  its  subordinate  committee  action,  which  there  is  in  the 
federal  plan,  and  other  values  besides. 

The  field  of  employee  representation  is  new,  however;  and 
varied  types  of  organization  are  being  used  by  different  companies 
with  much  satisfaction.  The  need  is  therefore  not  for  dogmatic 
criticism,  but  for  a  cordial  and  sympathetic  consideration  of 
every  plan  and  of  its  results  in  operation.  Experimentation 
in  shop  representative  organization  is  one  of  the  needs  of  the 
hour  and  one  of  its  hopeful  signs. 


CHAPTER  XXXI 
THE  BUSINESS  VALUE  OF  THE  COLLECTIVE  BARGAIN 

The  advisability  from  the  business  standpoint  of  collective 
bargaining  with  organized  labor  is  seriously  questioned  by  many 
managers.  Probably  upon  no  other  question  of  executive 
policy  do  wider  extremes  of  belief  exist.  Employers  who  for 
years  have  been  accustomed  to  collective  negotiations  are  as 
firm  in  their  view  that  they  would  not  return  to  the  old  con- 
ditions, as  are  the  majority  of  employers  that  this  method  of 
negotiation  should  be  opposed  to  the  limit.  In  each  case 
opinions  are  held  with  such  an  earnestness  of  conviction  and 
depth  of  emotion  that  an  examination  of  the  question  on  its 
merits  becomes  exceedingly  difficult. 

Moreover,  so  varied  are  the  types  of  labor  unions,  so 
varied  their  constitutions,  their  policies,  and  the  agreements 
they  have  made  that  generalizations  in  one  direction  can  easily 
be  refuted  by  citing  specific  instances  of  a  wholly  contrary 
experience.  Indeed  every  point  in  an  argument  either  for  or 
against  the  collective  agreement  could  be  countered  by  one  or 
more  illustrations  to  show  that  the  point  was  not  well  taken. 
In  the  face  of  such  a  wealth  of  contradictory  testimony  the  effort 
must  be  to  go  below  the  surface  and  analyze  the  more  per- 
manently true  facts  and  tendencies  in  the  relations  of  employers 
and  labor  unions.  Of  course,  the  actual  extension  of  collective 
bargaining  has  not  taken  place  as  a  result  of  the  employer's 
calculating  by  a  cool  logic  its  advantages  to  him.  But  it  is 
equally  true  that  this  type  of  agreement  could  not  have  extended 
as  it  has,  if  it  had  not  certain  definite  business  and  social  values. 

The  effort  should  therefore  be,  in  any  thorough  analysis 
of  all  the  elements  of  the  technique  of  personnel  administration, 
to  see  what  elements  of  business  value  the  collective  bargain 
may  already  have  shown,  how  its  business  value  may  be  increased 
and  what  the  limits  upon  its  business  value  are.  For  after  all, 
as  a  type  of  joint  relationships  of  employer  and  employee  the  col- 
lective bargain  deserves  as  careful  scrutiny,  from  this  point 
of  view  of  a  scientific  managerial  technique,  as  the  shop  committee 

446 


BUSINESS  VALUE  OF  THE  COLLECTIVE  BARGAIN      447 

or  any  other  proposal.  Careful  analysis  of  all  existing  experi- 
ments is  the  necessary  first  step  toward  the  selection  of  a  soundly 
constructive  practice. 

It  is  especially  true  today  that  the  relations  of  employers  to 
trade  unions  deserve  scientific  consideration.  For  the  managing 
world  faces  a  condition  and  not  a  theory  in  the  size  and  growth 
of  labor  organization.  Unions  have  already  achieved  a  place 
in  our  corporate  life  which  entitles  them  at  the  least  to  an  intelli- 
gent understanding  by  employers.  There  are  over  five  million 
organized  workers  in  this  country;  and  in  the  next  decade 
at  the  present  rate  of  gowth  there  will  be  more  than  twice  that 
number. 

If  for  no  other  reason,  then,  than  to  know  one  of  the  strongest 
currents  playing  about  the  mind  and  heart  of  the  manual  and 
even  brain  worker  today,  the  employer  should  have  an  adequate 
understanding  of  the  claims  of  the  unions,  and  of  those  employers 
who  have  dealt  with  them  successfully.  The  employment  ad- 
ministrator must  be  prepared  to  accommodate  himself  and  his 
policies  to  the  subtle  forces  and  influences  which  are  usually 
connoted  in  the  phrase  "the  temper  of  the  times."  To  know 
what  working  people  are  thinking  and  feeling  is  a  definite  duty 
of  the  executive  in  charge  of  personnel.  The  convictions  and 
the  successful  negotiation  methods  of  one  group  of  workers  are 
soon  known  and  urged  by  other  groups.  The  workers  of  every 
plant  are  exposed  in  a  greater  or  less  degree  to  the  ideas  which 
are  "going  the  rounds"  in  the  working  class  world.  In  this 
situation,  the  obligation  upon  the  employer  to  know  is  immediate 
and  real.  He  has  to  deal  with  contemporary  psychology — current 
moods  and  sentiments — not  with  those  which  were  current  when 
he  was  in  the  shop  or  in  college. 

But  the  duty  of  being  informed  is,  after  all,  a  comparatively 
passive  one.  The  manager  has  also  to  act  on  the  basis  of  that 
knowledge — act  favorably  or  not  toward  collective  bargaining. 

Definition. — "Collective  bargaining"  as  used  in  this  volume 
refers  to  dealings  under  written  contracts  or  oral  agreements  with 
labor  organizations  in  which  are  banded  together  the  workers 
of  a  trade  or  industry  in  a  given  geographical  area.  A  collective 
agreement  may  thus  be  made  by  a  labor  union  with  one  plant, 
with  one  corporation  covering  a  number  of  its  plants,  with  an 
employers'  association  of  a  city,  district  or  state,  or  with  a 
national  trade  association  or  employers'  group;  although  an 


448  PERSONNEL  ADMINISTRATION 

agreement  which  is  in  force  throughout  a  district  is  often  referred 
to  as  a  trade  agreement. 

It  is  important  to  recognize  that  the  phrase  "collective 
bargaining"  has  recently  been  applied  to  a  type  of  transaction 
which  differs  in  a  fundamental  respect  from  the  joint  bargain 
as  we  define  it.  Employers  are  now  speaking  of  negotiations 
with  their  own  employees  exclusively  through  the  medium  of 
shop  committees,  "factory  councils,"  "company  unions,"  etc., 
as  collective  bargaining.  Of  course,  any  use  of  a  phrase  is 
warranted  if  definition  is  agreed  upon  in  advance.  But  to  apply 
a  term  which  has  been  used  for  decades  to  connote  dealings 
with  an  inclusive  body  of  craft  or  industrial  workers,  to  dealings 
which  are  completely  confined  to  the  shop,  seems  to  us  not  only 
confusing;  it  seems  likely  to  lead  to  a  deception  both  of  workers 
and  of  managers  as  to  the  nature  of  the  shop  negotiations. 
Employers  may  honestly  believe  that  there  is  no  inherent  and 
fundamental  difference  between  negotiations  which  are  limited 
to  the  employees  of  one  shop  and  those  carried  on  with  unions, 
but,  until  this  is  shown,  to  apply  the  phrase  "collective 
bargaining"  to  both  types  of  transaction  is  to  confuse  the  basic 
issues. 

Assumptions  of  the  Individual  Bargain. — Discussion  of  collec- 
tive dealings  implies  a  comparison  with  some  other  form  of 
dealing — usually  with  the  individual  bargain.  For  that  reason 
it  will  be  useful  at  the  outset  to  examine  the  assumptions  upon 
which  individual  bargaining  really  rests;  and  the  conclusions 
to  which  they  lead. 

Dealings  on  an  individual  basis  rest,  first,  on  the  assumption 
that  the  company  can  be  responsible  for  protecting  adequately 
every  worker  in  its  employ.  This  means,  if  the  point  is  pressed 
to  its  final  implication,  that  the  company  should  have  its  agent 
present  at  every  time  and  place  where  a  point  of  friction  or 
maladjustment  with  its  workers  might  possibly  arise.  Or,  failing 
this,  the  company  should  be  sure  that  each  employee  will  dare 
to  and  be  able  to  voice  any  grievance  or  difference  which  has 
arisen,  when  that  agent  is  absent.  Ideally,  under  this  assump- 
tion, an  agent  of  the  company  should  always  lx?  on  the  spot 
to  straighten  out  difficulties.  But  this  would  of  course  require 
a  degree  of  omnipresence  which  in  the  large  factory  it  i.s  prac- 
tically impossible  for  the  management  to  attain.  As  the  alter- 
native, the  company  should  be  sure  that  it  can  find  out  (l>ecome 
omniscient)  through  having  the  workers  call  attention  to  difficul- 


BUSINESS  VALUE  OF  THE  COLLECTIVE  BARGAIN      449 

ties  as  they  arise.  But,  again,  the  assumption  of  the  worker's 
courage  and  ability  to  speak  effectively  in  self-defense  is  largely 
contrary  to  the  observed  facts  under  individual  bargaining.  In 
short,  the  implications  of  the  individual  bargain  if  they  are  hon- 
estly faced,  place  a  heavy  responsibility  upon  management  with 
respect  to  the  Tightness  of  the  terms  and  conditions  of  employ- 
ment. Indeed,  they  are  not  only  heavy — they  seem  almost 
super-human. 

The  second  assumption  is  that  the  company  will  be  responsible 
for  protecting  adequately  every  worker  in  its  employ.  So  long 
as  it  profits  the  company  to  protect  the  workers'  interests,  and 
so  long  as  the  company  knows  (by  omniscience,  intuition  or 
"mixing  around")  what  those  interests  are,  the  wise  manage- 
ment will  try  to  secure  that  protection.  But  if  a  time  comes 
when  the  company  does  not  know  the  workers'  desires,  or  feels 
that  its  aims  are  in  any  way  opposed  to  those  of  the  workers, 
there  is  no  assurance  that  the  company  will  act  in  a  manner 
which  it  believes  to  be  contrary  to  its  own  interest.  In  fact,  it 
would  be  a  strange  act  of  benevolence  if  it  did. 

This  implies,  of  course,  a  pursuit  of  self-interest  on  the  com- 
pany's part  which  some  will  characterize  as  unworthy  or  selfish. 
But  we  are  concerned  here  with  the  realities  of  life  rather  than 
with  moral  imputations.  If,  then,  in  some  critical  situation 
the  company  follows  its  own  interest,  the  employees'  interests 
are  no  longer  being  protected;  and  the  management  has  ceased 
to  exercise  the  responsibility  it  has  claimed  to  assume. 

We  conclude,  therefore,  first,  that  it  is  literally  not  possible  for 
the  company  adequately  to  protect  the  workers'  interests  be- 
cause in  the  last  analysis  it  cannot  by  its  own  efforts  fully  know 
them;  and  second,  that  to  attempt  to  protect  them  is  only 
partially  a  responsibility  of  management,  because  if  a  diver- 
gence of  aims  appears  to  arise  the  company  would  act  in  its 
own  interest.  The  continued  use  of  the  individual  bargain  in 
modern  industry  would,  in  short,  assume  a  degree  of  supervision 
of  workers  which  it  is  impossible  to  realize.  And  even  if  it  were 
possible,  its  use  would  be  out  of  harmony  with  that  sound  prin- 
ciple of  management  and  government  which  says  that  "the 
rights  and  interests  of  every  or  any  person  are  only  secure  from 
being  disregarded,  when  the  person  interested  is  himself  able, 
and  habitually  disposed  to  stand  up  for  them.1" 

xMiLL,  J.  S.,  Considerations  on  Representative  Government,  Chapter  III. 

29 


450  PERSONNEL  ADMINISTRATION 

The  necessity  for  this  self-protection  is  the  greater  in  industry 
because  of  the  fact  that  the  only  thing  which  the  worker  has  to 
sell — his  labor  power — becomes  daily  less  valuable  if  it  is  not 
sold.  It  is  a  highly  perishable  asset;  and  unless  he  can  promptly 
and  continuously  realize  on  it,  he  is  fatally  weak.  Under  the 
individual  bargain  this  weakness  is,  of  course,  at  the  maximum. 

Business  Values  of  the  Collective  Bargain. — If  it  is  true  that 
the  individual  bargain  places  upon  management  an  impossible 
burden  of  responsibility,  it  is  necessary  to  see  whether  the  col- 
lective agreement  is  of  value  in  reducing  this  burden.  What 
are  the  ways  in  which  it  may  have  business  uses? 

First,  the  collective  agreement  tends  to  equalize  the  bargain- 
ing status  of  workers  and  employers.  Surprising  as  it  may  seem 
this  is  of  advantage  to  the  employer.  It  is  an  axiom  of  good  busi- 
ness management  that  effective  production  depends  in  the  long 
run  upon  a  relationship  between  the  interested  parties  charac- 
terized by  a  high  sense  of  mutual  self-respect,  regard  for  indi- 
vidual dignity  and  equal  status. 

"The  real  basis  of  equality  in  a  democracy,"  it  has  been  well 
said,  "is  not  equal  pay,  but  equal  dignity  of  function."  That 
sense  of  equal  dignity  and  mutual  self-respect  is  at  the  same  time 
the  basis  of  goodwill  in  joint  relations,  and  the  result  of  bargain- 
ing on  a  basis  of  approximate  equality.  Equal  bargaining  power 
may  and  should  thus  mean  a  relationship  of  goodwill  and  per- 
sonal amity.  Where  this  is  not  the  case,  where  under  a  joint 
contract  there  is  constant  friction  and  quarreling,  the  difficulty 
is  usually  not  due  to  the  collective  feature,  so  much  as  to 
those  natural  personal  clashes  and  bickerings  which  have  really 
nothing  to  do  with  collective  bargaining  as  such.  Only  among 
equals  can  there  be  true  loyalty,  permanent  interest  in  the  joint 
enterprise,  continued  regard  for  the  personal  aims  of  each  indi- 
vidual in  relation  to  the  common  purpose  of  the  group. 

It  may  indeed  be  true  that  where  equality  of  bargaining  power 
exists  loyalty  and  interest  may  not  be  present.  Mere  equality 
alone  cannot  create  understanding,  confidence  and  goodwill. 
There  must  be  other  deliberate  and  conscious  efforts.  But  with- 
out equality  any  other  efforts  cannot  be  productive  of  truly 
right  relations  and  right  attitudes.  Loyalty,  interest  and  regard 
for  personality  cannot  continue  in  the  absence  of  a  condition 
of  equal  status.  The  virtues  fostered  in  a  situation  where  this 
equality  of  status  is  absent  are  what  the  philosophers  have 


BUSINESS  VALUE  OF  THE  COLLECTIVE  BARGAIN      451 

called  the  "slave  virtues" — submissiveness,  docility  which  occa- 
sionally breaks  out  into  revolt,  irresponsibility,  and  perfunctory 
performance  of  duties.  Managers  may  to  a  certain  extent  choose 
the  kind  of  working  class  attitude  they  will  cultivate  and  capi- 
talize. The  alternatives  today  are  a  condition  of  equal  status 
with  the  consequences  in  personal  attitude  among  the  workers 
which  that  brings ;  or  a  continued  master  and  servant  relation  with 
its  gulf  of  separation  and  the  consequences  of  that  which  are  today 
everywhere  apparent. 

Again,  only  among  equals  can  there  be  justice,  or  a  sense  of  the 
possibility  of  obtaining  justice  when  differences  arise.  A  group's 
conception  of  what  constitutes  justice  will  admittedly  change 
from  time  to  time.  But  that  does  not  alter  the  fact  that  what 
they  now  think  is  justice  is  vastly  precious  in  their  eyes;  and 
nothing  so  contributes  to  a  deep-seated  unrest  as  the  feeling 
that  the  conditions  or  terms  under  which  they  work  and  the  system 
under  which  they  live  are  unjust.  Such  a  sense  of  injustice  is 
certainly  somewhat  modified  by  the  use  of  collective  dealings; 
even  if  some  other  type  of  relationship  may  eventually  be  neces- 
sary to  satisfy  later  and  more  exacting  conceptions  of  a  just 
industrial  order. 

To  the  extent,  therefore,  that  joint  dealings  create  a  sense  of 
equality  and  justice,  they  may  contribute  as  nothing  else  can 
to  the  creation  of  goodwill  and  a  cooperative  spirit  in  the  process 
of  production.  And,  once  the  negotiations  are  completed  and 
terms  agreed  upon,  there  is  every  advantage  to  both  sides  in 
fostering  this  atmosphere  in  the  shop  under  which  alone  the  work 
can  go  forward  quickly  and  well. 

The  Consideration  of  Grievances. — Another  of  the  primary 
values  of  collective  dealing  is  to  supply  a  fair  and  prompt  medium 
for  the  full  consideration  of  complaints,  grievances,  and  all 
differences.  Continuous  operation,  friendly  feeling  and  efficiency 
depend  upon  keeping  the  air  clear  at  all  times,  upon  having  the 
thoughts,  desires  and  hopes  of  both  sides  commonly  known. 

There  are  several  theories  as  to  the  best  ways  of  handling  shop 
maladjustments.  The  first  is  the  theory  of  the  manager's 
"open  door," — a  relic  of  the  days  when  the  majority  of  shops 
were  small, — an  attitude  which  finds  expression  in  the  sentence 
"my  door  is  always  open  and  any  worker  that  has  anything  on  his 
mind  can  come  right  to  me."  The  success  of  this  method  of 
treating  with  employees  depends  on  several  factors.  The  mana- 


452  PERSONNEL  ADMINISTRATION 

ger's  fairness  and  equanimity  of  temper  must  first  be  assured; 
and  he  must  be  fairly  regularly  on  the  job.  It  must  be  clear 
that  the  worker  knows  that  this  channel  exists;  that  he  dares  to 
use  it;  and  that  if  he  uses  it,  he  will  not  be  discriminated  against 
in  the  shop.  And  the  question  also  arises  as  to  what  is  to  happen 
when  all  workers  desire  to  press  the  same  demand,  but  find,  as 
is  usual  with  the  "open  door"  theory,  that  the  manager  "will 
treat  with  my  men  as  individuals,  but  will  not  receive  a  com- 
mittee." There  are,  in  short,  too  many  qualifying  conditions  to 
assure  that  maladjustments  will  find  their  way  through  the 
"open  door."  If  they  do  not,  a  congestion  of  ill-will  is  develop- 
ing which  has  its  positive  dangers. 

Another  way  of  handling  complaints  which  has  some  vogue  at 
the  present  moment  is  through  the  personnel  department. 
This  department  is  in  certain  plants  being  asked  to  serve  as  the 
channel  of  communication  with  the  workers,  as  the  medium  of 
conciliation  and  the  employees'  spokesman.  The  members  of 
the  personnel  department  are  conceived  as  moving  about  the 
plant,  mingling  with  the  workers,  listening  to  their  comments 
and  establishing  a  cordial  relation  which  makes  the  personnel 
worker  the  natural  confidant  of  the  worker  in  trouble.  We  have 
throughout  these  pages  urged  the  necessity  for  personal  contact 
between  management  and  men.  But  it  seems  to  us  that  to 
carry  this  idea  to  the  extreme  position  which  makes  of  the  execu- 
tives in  charge  of  human  relations,  the  agents  for  grievance  con- 
sideration, or  the  mouthpiece  of  the  employees,  is  radically 
to  misconstrue  the  function  of  personnel  administration.  The 
personnel  administrator  rightly  conceived  is  one  of  the  manage- 
ment. True,  he  is  that  one  of  the  management  presumably  best 
equipped  by  insight,  special  training  and  experience,  to  know  the 
workers'  point  of  view  and  desires.  He  is  the  one  who  specializes 
on  industrial  relations.  But  the  same  limitations  upon  communi- 
cation between  managers  and  men  which  apply  to  the  "open 
door"  theory,  apply  also  to  the  use  of  the  personnel  department. 
It  is  still  implied  that  workers  know  the  channel;  dare  to  use 
it;  can  use  it  without  prejudice;  can  use  it  with  expectation  of 
prompt  and  fair  action  upon  their  case.  It  is  still  assumed  that 
there  are  no  grievances  or  demands  which  are  a  group  affair; 
that  in  all  matters  affecting  his  relationship  with  the  employer 
each  worker  is  presumably  concerned  only  as  an  individual.  It 
is  assumed,  moreover,  that  some  self-constituted  agent  can 
speak  for  the  workers  better  than  they  can  speak  for  themselves. 


BUSINESS  VALUE  OF  THE  COLLECTIVE  BARGAIN      453 

It  has  probably  been  true  that  some  personnel  departments 
have  been  introduced  with  a  desire  to  find  out  in  any  possible 
way  what  the  workers  were  thinking;  to  be,  in  other  words,  a 
high  grade  department  of  information.  This  is  definitely  an 
exploitation  and  a  misappropriation  of  the  true  conception  of 
personnel  administration.  And  any  management  which  allows 
the  workers  of  its  personnel  staff  to  give  validity  to  such  a  view 
by  their  activities,  is  in  reality  doing  a  serious  injustice  to  the 
whole  idea  of  sound  management.  It  is  true,  of  course,  that  the 
existence  of  a  personnel  department,  the  personal  contacts  which 
its  members  make,  the  point  of  view  which  its  head  espouses, — 
all  tend  to  make  the  administration  of  human  relations  intelligent 
and  satisfactory.  But  that  is  a  purpose  quite  different  from 
having  agents  of  the  management  mingling  constantly  among  the 
men  to  find  out  what  they  are  thinking  and  hear  what  they  are 
saying. 

In  fact,  this  method  of  personnel  work  borders  too  closely  upon 
a  third  highly  questionable  method  of  knowing  the  workers 
minds.  This  third  method  is  the  use  of  detectives  in  the  plant. 
Some  managers  have  defended  with  considerable  show  of  warmth 
the  use  of  detectives  in  their  shops  because,  as  they  said,  "How 
else  are  we  to  find  out  what  they  think?  We  don't  speak  Polish 
(or  Italian  or  whatever  tongue  it  may  be)  and  they  don't  speak 
English.  And  besides  we  must  keep  out  agitators." 

There  are  no  problems  of  shop  maladjustment  about  which  the 
management  has  the  need  of  full  information,  which  cannot  be 
better  discovered  in  some  other  way  than  through  detectives. 
Moreover,  the  presence  of  detectives  in  a  plant  creates  more 
suspicion,  ill-will  and  distrust  in  a  month  than  all  the  activities 
of  a  personnel  department  put  together  can  banish  in  a  year. 
Nor  is  this  putting  the  matter  too  strongly.  What  the  detectives 
learn  may  be  the  basis  of  laudable  corrective  effort  on  the  manage- 
ment's part;  but  in  the  majority  of  cases  that  effort  is  foredoomed 
to  be  fruitless  of  truly  better  relations  because  the  workers  know 
that  they  are  not  trusted,  that  they  are  being  spied  upon,  that 
any  spontaneous  efforts  at  self-protection  and  self-improvement 
will  be  immediately  suppressed.  And  where  people's  native 
self-respect  is  not  being  appealed  to,  no  fundamental  benefit 
is  resulting. 

A  far  more  fruitful  method  of  establishing  a  fair  basis  of 
rapprochement  is  the  shop  committee  or  the  employees'  associa- 


454  PERSONNEL  ADMINISTRATION 

tion.  Short  as  has  been  America's  experience  with  these  types 
of  organization,  it  has  been  long  enough  to  indicate  that  much 
can  be  accomplished  through  their  use  in  keeping  adequate 
channels  of  communication  and  personal  association  open. 
Much  can  be  done  to  make  vocal  and  intelligible  the  workers' 
thoughts,  demands,  and  desires.  And  there  are  shops  now  hav- 
ing such  intra-mural  organization,  which  may  not  feel  any  serious 
deficiency  in  that  type  of  agency  for  some  time  to  come.  They 
will  be  able  to  settle  with  amity  and  good  faith  whatever  dis- 
agreements arise. 

But  in  a  really  fundamental  analysis  of  joint  relations  it  would 
be  unjust  to  those  wishing  to  consider  a  permanently  sound 
policy  not  to  go  further.  Hence  it  is  in  point  to  restate  here  sum- 
marily the  limitations  upon  the  use  of  shop  committees  as 
grievance-handling  agencies. 

Shortcomings  of  Shop  Committees. — The  shop  committee 
has  thus  far  in  this  country  been  an  employer-created  body.  If 
at  any  time  the  management  felt  that  it  no  longer  cared  to  attend 
to  or  "bother  with"  the  workers'  thoughts,  demands  or  desires, 
it  could  under  certain  restrictions  stated  in  the  constitutions  of 
the  plan,  withdraw  it  altogether.  Without  question  this  would 
usually  be  bad  business — be  a  display  of  serious  managerial 
incompetence.  Taking  account  of  the  workers'  point  of  view  is 
an  important  management  duty  at  all  times.  Nevertheless, 
cases  are  not  unknown  where  a  management  has  changed  its 
policy  from  one  of  cordial  dealings  to  one  of  arbitrary  exercise 
of  authority.  And  if  the  workers  have  an  organization  which  is 
self-initiated,  self-perpetuating,  and  in  receipt  of  outside  support 
and  counsel,  there  is  at  hand  a  body  capable  at  once  of  preventing 
the  employer  from  trying  to  do  away  with  the  agency  of  joint 
conference  and  capable  of  protecting  the  employee  in  case  of  that 
arbitrary  action. 

We  know  of  one  large  plant  in  which  a  shop  committee  had 
worked  satisfactorily  and  the  management  was  in  general  pur- 
suing a  progressive  labor  policy,  where  the  workers  began  to 
seek  membership  in  the  labor  unions  as  soon  as  a  son  of  the  head 
of  the  company  appeared  in  the  business.  The  workers  said 
definitely  that  they  feared  that  the  son  would  soon  change  the 
management  policy  unless  there  was  some  wholly  self-sufficient 
employees'  organization  to  withstand  any  reversion  to  a  less 
liberal  administration. 


BUSINESS  VALUE  OF  THE  COLLECTIVE  BARGAIN      455 

Again,  the  shop  organization  is  not  a  body  which  can  deal  with 
the  employer  on  a  basis  of  equal  bargaining  power.  The  im- 
portance of  such  a  sense  of  equal  competence  we  have  already 
dwelt  upon.  And  it  requires  no  elaborate  argument  to  show  that 
the  modern  corporation  has  at  all  times  advantages  in  financial 
resources,  executive  leadership,  association  with  other  employers 
in  the  industry  and  permanency  of  life  through  a  waiting  period, 
all  of  which  the  employees  of  that  corporation  do  not  by  themselves 
possess. 

A  third  serious  drawback,  which  helps  to  create  the  second,  is 
the  fact  that  leadership  in  the  workers'  organization  is  too  likely 
not  to  prove  a  match  for  the  ability  of  the  executives  against 
which  it  is  pitted.  So  accustomed  is  the  management  to  "play- 
ing the  game"  that  it  is  hard  for  it  to  realize  that  there  is  a  point 
beyond  which  it  does  no  good  to  "play  the  game"  on  the  workers. 
It  may,  for  example,  be  possible  to  argue  a  shop  committee  into 
acceptance  of  a  wage  scale  which  is  lower  than  the  management 
ought  to  pay  in  order  to  get  the  kind  of  work  it  wants.  But 
the  manager  who  is  always  "playing  the  game"  tends  to  get  so 
interested  in  "putting  it  over"  on  the  committee,  that  he  fails 
to  realize  that  he  is  in  such  a  case  also  putting  it  over  on  himsetf . 

Hence  to  prevent  management  from  overreaching  itself  as 
well  as  to  assure  adequate  protection  to  the  workers,  there  is 
need  for  a  leadership  among  the  employees  which  can  meet  the 
management  competently  on  its  own  ground.  Such  leadership 
in  order  to  be  upon  a  parity  with  the  executive  leadership  it  may 
confront,  requires  knowledge  of  the  shop,  knowledge  of  the 
industry,  knowledge  of  local  and  general  labor  conditions,  ability 
to  present  and  argue  a  case  effectively,  ability  to  address  the 
management  with  no  fear  of  possible  prejudice  to  one's  job. 

Only  rarely  will  such  a  combination  of  requirements  exist 
together  in  the  employee  representative.  The  case  for  the  use  of 
the  business  agent  of  the  union  rests  in  part  upon  this  patent 
fact:  That  the  person  who  is  to  possess  the  combination  of  talents 
needed  to  meet  business  managers  effectively  on  their  own  ground 
must  be  specially  trained  for  the  job  and  must  be  in  a  position  where 
he  is  not  directly  dependent  upon  the  management  for  his  support. 

We  recognize  and  urge  that  there  are  many  important  matters 
which  can  be  much  better  handled  wholly  inside  the  shop  with  the 
workers  or  their  delegates  directly,  than  with  a  union  agent.  But 
if  we  admit  the  desirability  of  equal  bargaining  power,  we  must 


456  PERSONNEL  ADMINISTRATION 

be  prepared  to  accept  those  attendant  conditions  which  really  create 
equality.  And  a  dispassionate  examination  seems  to  indicate  that 
the  employment  of  an  outside  spokesman  for  the  workers,  in 
relation  to  matters  like  wages  and  hours,  which  help  to 
determine  the  level  of  an  industry's  labor  standards,  is  essential 
to  bringing  an  approximate  equality  of  bargaining  power  into 
being. 

There  is,  however,  little  excuse  at  the  present  stage  of  union 
growth  and  development  for  continuous  interference  in  shop 
affairs  and  practices  by  the  local  agents  of  the  union — except 
where  the  employer's  tolerance  of  unionism  is  so  precarious  that 
eternal  vigilance  by  the  union's  representative  becomes  the 
price  of  continued  joint  relations.  When  union  agents  are  a 
disruptive  influence  and  are  interfering  unwarrantedly  in  the 
making  and  carrying  out  of  agreements,  the  solution  is  in  more, 
rather  than  less,  use  of  organization.  The  remedy  is  in  con- 
stantly striving  to  have  the  terms  of  the  collective  instrument 
explicit  upon  those  matters  which  relate  to  the  activities  of  the 
business  agent,  and  upon  the  intra-shop  machinery  for  handling 
purely  shop  frictions  and  grievances.  For  it  will  usually  be  found 
true  that  the  union  organizer's  activity  in  shop  affairs  is  in  direct 
proportion  to  the  workers'  conviction  that  they  need  help  in  securing 
justice  and  fair  treatment  within  the  shop.  And  where  over  a 
period  of  time  the  management  shows  itself  willing  and  eager  to 
settle  all  shop  differences  in  an  equitable  way  and  to  fulfil  the 
spirit  as  well  as  the  letter  of  the  joint  agreement,  the  inter- 
vention of  the  business  agent  will  seldom  cause  annoyance  or 
inconvenience. 

A  final  shortcoming  of  shop  organizations  is  that  they  are  not 
in  touch  with  other  groups  and  forces  in  the  industry  which  are 
helping  to  determine  the  terms  of  employment  under  which  the 
employees  in  any  one  plant  can  secure  work.  The  shop  group  can- 
not act  most  wisely  until  it  can  act  in  the  light  of  knowledge 
about  the  raw  materials,  the  state  of  demand  for  the  product, 
for  labor,  etc.  Conceivably  much  of  this  knowledge  could  be 
assembled  by  the  workers  in  each  shop,  but  to  secure  it  would 
require  a  degree  of  advisory  conference  with  widely  acquainted 
experts  which  would  in  the  end  come  to  much  the  same  thing 
as  now  exists  in  the  organization  and  activity  of  the  international 
union  in  that  industry. 

There  are,  therefore,  we  believe,  certain  values  necessary  to  the 


BUSINESS  VALUE  OF  THE  COLLECTIVE  BARGAIN      457 

maintenance  of  right  relations  which  independent  shop  organiza- 
tions do  not  provide.  These  values  are  to  be  attained,  if  this 
analysis  is  correct,  by  the  creation  and  maintenance  of  a  self-con- 
stituted workers'  organization  through  which  grievances  can 
always  be  voiced;  the  use  of  an  expert  agent  to  intercede  in  the 
settlement  of  the  larger  issues;  the  creation  of  agreements  which 
specifically  define  the  terms  of  operation  on  many  points  which 
might  otherwise  be  in  constant  dispute  (e.g.,  causes  of  discharge, 
time  of  payment,  method  of  payment,  etc.). 

In  short,  collective  bargaining  as  here  defined  appears  to  assure 
as  does  no  other  method  of  dealing  between  management  and  men, 
that  all  the  time  and  on  every  point  the  rights  of  the  workers  are 
being  guarded  and  are  receiving  adequate  consideration.  "Hu- 
man beings,"  it  has  been  wisely  said,  "are  only  secure  from  evil 
at  the  hands  of  others,  in  proportion  as  they  have  the  power  of 
being,  and  are,  self-protecting;  and  they  only  achieve  a  high 
degree  of  success  ...  in  proportion  as  they  are  seli-dependent, 
relying  on  what  they  themselves  can  do,  either  separately  or  in 
concert,  rather  than  on  what  others  do  for  them."1 

The  writer  of  these  sentences  goes  on  to  say  that  many  "have 
a  great  dislike  to  it  (the  above  proposition)  as  a  political  doctrine, 
and  are  fond  of  holding  it  up  to  obloquy  as  a  doctrine  of  universal 
selfishness."  But  as  he  points  out,  it  is  not  so  much  that  one 
class  or  group  now  knowingly  or  deliberately  ignores  or  tres- 
passes upon  the  concern  of  others;  "it  suffices  that,  in  the  ab- 
sence of  its  natural  defenders,  the  interest  of  the  excluded  is  always 
in  danger  of  being  overlooked;  and,  when  looked  at,  is  seen  with 
very  different  eyes  from  those  of  the  persons  whom  it  directly 
concerns." 

In  asking  consideration  of  the  collective  bargain  as  a  positive 
guarantee  of  the  exercise  of  a  normal  and  necessary  amount  of 
self-interest,  we  are  only  pointing  to  a  state  of  affairs  which  has 
constant  advantage  to  both  sides.  For  it  is  the  state  of  affairs 
under  which  equal  protection  of  the  rights  of  all  groups  can  at 
the  present  day  best  be  approximated. 

Moreover,  to  construe  this  argument  as  an  encouragement 
of  selfishness  would  be  wholly  to  misunderstand  our  point. 
Under  modern  conditions  the  employee's  first  solicitude  is  in- 
evitably and  properly  one  for  his  own  survival.  Until  he  has 
assurance  of  the  initial  needs  of  life  for  himself  and  family  it  is 

1  MILL,  J.  S.,  Considerations  on  Representative  Government,  Chapter  III. 


458  PERSONNEL  ADMINISTRATION 

humanly  impossible  to  enlist  his  interest  in  wider  purposes. 
It  is  indeed  not  too  much  to  say  that  the  attitude  in  which  any 
work  is  done  most  efficiently  is  one  where  there  is  reasonable 
freedom  from  worry  about  making  both  ends  meet.  And  far 
from  characterizing  anxiety  for  self-protection  and  efforts  for  an 
assured  basis  of  livelihood  as  promptings  of  selfishness,  managers 
should  be  seeking  to  establish  an  adequate  basis  of  livelihood, 
either  through  collective  negotiation,  by  universally  operative 
legal  minimum  standards,  or  by  both. 

In  short,  it  is  true  that  it  must  be  a  primary  concern  of  any 
group  to  see  that  watch  is  being  kept  over  the  essential  conditions 
of  its  survival.  An  inviolable  part  of  any  group's  generous  and 
outreaching  purposes  is  the  protection  of  its  own  integrity. 
This  is  the  first  point  at  which  self-interest  and  social  interest 
usually  intersect.  It  is  only  when  any  group's  purposes  are 
wholly  selfish,  anti-social  and  out  of  date  that  its  primary  self- 
interest  may  be  irreconcilable  with  the  social  interest. 

And  it  is  further  true  that  a  group's  integrity  can  in  the  long 
run  only  be  assured  by  its  own  efforts.  It  is  at  least  the  first 
judge  of  the  essential  conditions  of  its  survival.  And  because 
this  is  true,  there  has  arisen  the  political  principle  which  is  now 
being  slowly  but  definitely  read  into  the  theory  of  sound  indus- 
trial government,  that:  In  carrying  on  an  enterprise  every  partici- 
pating group  which  is  affected  by  decisions  concerning  the  operation 
of  the  enterprise,  should  be  a  party  to  the  making  of  those  decisions. 

In  pursuance  of  a  discreet  but  inevitable  application  of  this 
principle  to  industrial  administration,  the  use  of  collective  bar- 
gaining under  ordinary  conditions  deserves  careful  consideration 
as  the  most  practical  and  educational  method  thus  far  utilized. 


CHAPTER  XXXII 

THE  BUSINESS  VALUE  OF  THE  COLLECTIVE  BARGAIN 

(CONTINUED) 

A  situation  has  now  grown  up  where,  even  under  the  collective 
bargain,  it  is  hard  to  provide  for  recognition  and  reward  of  differ- 
ent degrees  of  competence.  The  reason  is,  of  course,  that  workers 
have  found  from  experience  that  differentiations  in  pay  through 
bonuses  and  piece  rates  prejudice  the  chances  of  the  medium 
grade  workers  and  tend  to  speeding  up  and  rate  cutting.  There- 
fore, although  the  tendency  has  not  yet  worked  out  in  practice 
to  any  great  extent,  it  is  now  true  that  only  under  collective  bar- 
gaining can  any  system  of  differentiation  in  work  and  pay  on 
a  basis  of  grades  of  competence  at  a  job  take  place  with  safety 
to  the  workers.  Only  under  collective  dealing  are  the  workers 
strong  enough  to  control  differential  payments  in  ways  not  preju- 
dicial to  the  security  of  the  group  as  a  whole.  For  the  stock 
union  objection  to  this  differentiation  does  not  arise  out  of  a 
love  of  sloth  or  mediocrity;  it  arises  out  of  a  fear  which  only 
strong  organization  on  both  sides  can  remove. 

The  objection  may  be  offered  that  recognition  and  rewarding 
of  individual  competence  is  one  of  the  prime  values  of  the  indi- 
vidual bargain — which  should  be  retained  for  this  reason.  And 
it  was  undoubtedly  true  in  times  past  that  by  individual  nego- 
tiations over  terms  of  employment,  individual  initiative  was 
encouraged,  incentives  held  out  and  rewards  adjusted  to  effort. 
But  it  certainly  does  not  so  work  out  under  present-day  arrange- 
ments— if  we  leave  out  of  account  the  various  premium  methods 
of  pay  which  have  never  had  wide  use  nor  been  popular  with  the 
workers.  The  necessities  of  the  case  have  already  limited  the 
actual  operation  of  individual  negotiations.  Wages  in  large 
plants  are  now  set  uniformly  for  all  at  the  same  job;  standard 
rates  prevail  even  where  there  is  no  collective  dealing.  In 
short,  any  value  which  the  individual  bargain  ever  had  with 
manual  workers  in  the  direction  of  supplying  initiative  has 
already  disappeared. 

459 


460  PERSONNEL  ADMINISTRATION 

Under  collective  bargaining  there  is,  also,  one  agreement; 
one  period  of  negotiation  each  year,  instead  of  constant  likelihood 
of  demands;  one  party  of  the  second  part,  instead  of  as  many 
parties  as  there  are  employees. 

The  real  business  values  of  this  consolidated  bargaining  are  not 
to  be  ignored.  It  means  that  individual  selection  takes  place  on 
a  basis  of  publicly  known  terms  and  conditions  of  employment; 
it  means  that  these  terms  instead  of  representing  what  the 
management  thinks  the  majority  of  workers  will  accept,  embody 
what  their  recognized  spokesmen  have  agreed  to  as  desirable. 
It  enables  the  attention  of  all,  once  the  terms  are  agreed  upon, 
to  be  fastened  on  other  matters. 

Moreover,  the  task  of  fulfilling  the  workers'  side  of  the  agree- 
ment devolves  upon  a  national  organization  whose  power  and 
prestige  depend  increasingly  upon  its  ability  to  honor  the  agree- 
ments which  it  makes.  That  this  is  a  practical  consideration 
will  be  realized  if  the  alternative  situation  is  imagined.  If,  for 
example,  a  company  were  to  make  through  its  shop  committee 
a  definite  agreement  for  a  term  of  months  on  a  wage  and  hour 
scale,  and  if  the  workers  were  to  break  the  agreement  and  strike, 
there  would  be  no  outside  influence  to  help  effect  a  resumption 
of  work.  But  such  a  situation  in  a  union  shop  is  met  by  definite 
and  usually  effective,  discipline  from  the  national  union  head- 
quarters, in  terms  of  charter  suspension  and  non-payment  of 
strike  benefits. 

Two  objections  will,  however,  be  properly  raised  in  this  con- 
nection. First,  that  when  there  are  several  craft  unions  in  a 
plant,  it  is  sometimes  necessary  to  enter  into  several  agreements; 
and  second,  that  even  with  the  disciplinary  activities  of  the 
national  union,  contracts  are  sometimes  violated  by  the  workers. 

It  is,  of  course,  undoubtedly  true  that  where  members  of 
several  organized  crafts  work  in  one  shop,  they  may  not  have 
reached  a  point  of  sufficient  federation  to  act  together  in  the 
making  of  a  single  joint  agreement.  Every  day,  however,  shows 
the  federating  principle  more  strongly  at  work  and  we  see  such 
strong  groups  as  the  building,  printing,  railroad,  needle,  ship- 
building, leather  working,  mining  and  metal  trades, — all  working 
in  federation  in  the  drawing  of  joint  agreements. 

Indeed,  the  objection  that  there  is  a  variety  of  crafts  (except 
where  they  create  the  delay  and  irritation  of  jurisdictional  dis- 
putes) is  not  always  the  employer's  objection.  For  he  has  fie- 


BUSINESS  VALUE  OF  THE  COLLECTIVE  BARGAIN      461 

quently  found  that  he  prefers  to  have  different  contracts  with 
different  craft  bodies,  which  terminate  at  different  times  and  thus 
prevent  the  likelihood  of  a  simultaneous  walk-out.  As  to  juris- 
dictional  disputes,  they  are  without  question  a  source  of  real  and 
justified  annoyance  to  the  employer.  He  finds  himself  helpless 
before  a  controversy  which  he  is  powerless  to  settle,  and  the 
merits  of  which  are  often  of  no  special  interest  to  him.  He  is 
confronted  with  a  result  of  economic  evolution  out  of  which  the 
unions  themselves  hope  to  grow  as  soon  as  possible,  since  it 
hurts  them  no  less  than  him.  Meanwhile  there  seems  to  be  no 
alternative  but  patient  tolerance  plus  an  effort  to  bring  the  dis- 
puting crafts  together  before  methods  or  materials  of  work  are 
adopted  which  may  be  potential  sources  of  inter-craft  contro- 
versy.1 It  may,  indeed,  be  safely  affirmed  that  objection  to  one 
agreement  with  a  federation  of  crafts  is  not  usually  raised  by  the 
crafts  involved.  The  employer  who  wants  to  include  all  nego- 
tiations in  one  agreement  will  increasingly  find  the  unions  ready 
to  meet  him  on  this  point. 

A  further  aspect  of  the  value  of  having  a  single  agreement — or 
a  single  agreement  for  all  workers  in  a  given  craft  or  branch  of  a 
trade — is  that  it  fixes  labor  costs  at  a  definite  figure  during  the 
life  of  the  contract. 

The  Violation  of  Collective  Agreements. — It  is,  of  course,  true 
that  unions  sometimes  break  their  contracts.  It  is  important 
to  consider  this  difficulty  as  thoroughly  as  space  will  permit,  since 
so  much  of  the  opposition  to  unionism  focuses  at  this  point. 
The  problem  has  two  aspects:  First,  the  aspect  of  the  breaking 
of  agreements — why  are  they  broken?  Second,  the  aspect  of  the 
accountability  of  the  unions  for  the  keeping  of  the  agreements — 
how  can  accountability  be  assured  with  due  consideration  for  all? 

There  are  four  typical  causes  of  the  violation  of  joint  agree- 
ments by  unions: 

(1)  The  Sympathetic  Strike. — The  sympathetic  strike  to  aid 
the  cause  of  fellow-workers  in  another  craft  or  locality  will 
always  seem  to  the  employer  to  be  a  dubious,  if  not  indefensible, 
practice.  Indeed,  union  leaders  themselves  appear  to  be  increas- 
ingly sharing  this  view,  since  the  tendency  is  strongly  in  the 

1  There  exists  now  a  National  Board  of  Jurisdictional  Awards  in  the 
Building  Industry,  consisting  of  eight  members,  three  representing  the  Build- 
ing Trades  Department  of  the  A.  F.  of  L.  and  five  representing  the  several 
employers'  groups. 


462  PERSONNEL  ADMINISTRATION 

direction  of  taking  away  from  local  bodies  the  power  of  calling  a 
strike,  and  vesting  it  in  the  executive  committee  of  the  national 
union;  or  of  requiring  a  secret  ballot  referendum  of  the  member- 
ship of  the  union.  Statistical  study  of  the  causes  of  strikes  indi- 
cates that  these  changes  are  having  a  decided  effect — since  fewer 
and  fewer  strikes  of  sympathetic  origin  are  now  being  called. 
This  objection  has,  in  short,  much  less  force  than  it  had  a  few 
years  ago. 

It  is,  however,  useful  to  understand  why  the  sympathetic 
strike  is  used.  It  rests  upon  a  premise  which  the  employer 
cannot  ignore,  since  much  working  class  sentiment  and  policy 
are  based  upon  it — the  premise  of  the  solidarity  of  all  manual 
workers'  interests.  The  cause  of  one  worker,  in  this  view,  is  the 
cause  of  all ;  all  rise  together  and  advance  only  as  fast  as  the  rear 
guard  advances.  This  belief  has  its  negative  and  its  positive 
manifestations;  that  is,  it  is  used  for  the  purposes  of  defence  and 
offense.  The  sympathetic  strike,  as  a  defensive  weapon,  is  used 
by  workers  to  assist  their  fellows  in  preserving  or  improving 
their  status  as  wage  earners.  And  it  seems  reasonably  clear 
that  its  use  for  this  purpose  will  decrease  as  soon  as  the  workers 
find  that  with  stronger  organizations  they  can  utilize  better 
ways  of  bargaining. 

The  case  is  different,  however,  when  the  purpose  of  the  strike  is 
to  effect  a  change  in  tfie  status  of  the  worker,  or  to  advertise  the 
possibility  of  such  a  change  taking  place.  The  strikes  in  Winni- 
peg and  Seattle  early  in  1919  illustrate  the  use  of  the  sympathetic 
strike  for  this  offensive  purpose.  Indeed,  they  illustrate  a  new 
type  of  strike. 

(2)  The  Unforeseen  Contingency. — One  of  the  most  frequent 
causes  of  broken  agreements  has  been  the  entrance,  after  the  sign- 
ing, of  some  unforeseen  contingency  from  which  the  agreement 
appears  to  offer  no  relief.  Examples  of  this  are  rapid  increases 
in  living  costs,  new  machinery  or  new  processes  with  the  prob- 
lem of  re-setting  rates,  providing  for  displaced  workers,  and 
changes  in  the  state  of  demand  for  the  product.  The  difficulty 
in  the  majority  of  such  cases  is  usually  that  the  agreement  has 
not  provided  adequately  for  dealing  jointly  with  all  special  dues. 

And  in  the  remainder  of  cases  it  is  probably  true  that  the 
union  has  made  the  appearance  of  new  conditions  the  occasion 
for  increasing  the  strength  of  its  defenses.  If,  for  example, 
after  an  agreement  is  made,  the  workers  find  that  the  demand 


BUSINESS  VALUE  OF  THE  COLLECTIVE  BARGAIN      463 

for  the  product  is  peculiarly  brisk,  they  may  decide  to  take 
advantage  of  the  situation  to  press  for  higher  wages.  There  is, 
from  the  employer's  point  of  view,  little  or  no  justification  for 
such  questionable  tactics;  and  in  the  stronger  unions  little 
support  could  probably  now  be  rallied  to  such  practices 
among  the  workers  themselves.  But  no  understanding  of 
union  tactics  is  possible,  if  one  does  not  bear  in  mind  that  the 
first  concern  of  the  working  class  organization  is  to  bring  itself 
to  a  point  of  strength  where  it  is  able  to  do  its  defensive  work 
adequately.  This  is  not  said  by  way  of  palliation  of  any  uinon 
tactics;  it  is  said  only  by  way  of  explanation.  The  present-day 
union,  we  have  always  to  remember,  is  primarily  a  defensive 
body.  Its  primary  reason  for  being  is  to  protect  the  minimum 
standards  of  living  and  working  which  the  workers  have  already 
attained — and  its  secondary  reason  is  progressively  to  advance 
those  standards. 

In  short,  the  best  remedy  for  a  situation  where  agreements  are 
broken  because  of  some  unforeseen  contingency,  is  to  see  to  it 
that  in  the  future  the  agreement  is  sufficiently  explicit  and 
flexible  to  cope  with  all  possible  developments.  It  will, 
therefore,  be  advisable  for  us  presently  to  consider  what  the 
form  and  content  of  the  collective  bargain  should  be. 

(3)  The  General  Strike. — This  is  a  manifestation  of  working 
class  solidarity  which  generally  has  as  its  object  to  demonstrate 
the  power  of  the  workers — power  to  act  independently  and  power 
eventually  to  take  an  effectual  part  in  the  control  of  industry  in 
some  other  capacity  than  as  "wage  slaves."  The  general  strike, 
"the  revolutionary  strike,"  "the  strike  of  the  folded  hands,"- 
these  are  methods  of  militant  action  directed  more  or  less  con- 
sciously against  the  present  system.  They  are  cessations  from 
work  which  are  often  unaccompanied  by  the  presentation  of  any 
formal  demands. 

It  is  important  for  employers  to  understand  this  type  of  strike ; 
for  it  is  a  form  of  working  class  activity  which  may  spread  where 
conditions  are  such  as  to  afford  soil  for  "revolutionary"  propa- 
ganda. And  it  will,  if  recent  instances  provide  proof  of  a  rec- 
ognized technique,  probably  appear  largely  as  a  "manifestation 
of  solidarity,"  which  occurs  suddenly,  without  warning  and  only 
for  a  few  days'  duration,  rather  than  as  a  specific  demand  for  a 
change  in  methods  of  shop  or  industrial  control. 

The  general  strike  is  the  more  bewildering  to  the  employer  & 


464  PERSONNEL  ADMINISTRATION 

that  it  is  not  directed  against  him,  but  against  "the  system." 
To  be  sure,  the  employees  of  any  single  corporation  which  pro- 
vides exceptionally  fine  working  conditions  and  generous  terms  of 
employment,  may  be  immune  from  these  "radical"  influences. 
But  that  after  all  proves  nothing,  as  such  corporations  are  not 
typical  of  corporate  behavior;  and  even  if  they  were,  they  would 
be  accused  of  subversive  "benevolence"  by  those  workers  who 
condemned  the  system  as  unethical  or  unscientific. 

As  a  practical  matter,  it  is  largely  a  question  of  the  manage- 
ment's vision,  good  temper  and  ability  to  adopt  a  group  of 
policies  which  will  be  educational  in  the  best  and  widest  sense. 
Some  well-managed  concerns  may  be  destined  to  suffer  irritating 
and  distressing  interruptions  from  this  cause.  But  if  the 
general  strike  is  viewed  historically  as  well  as  practically  there 
will  be  less  occasion  for  managers  to  despair  of  the  efficacy  of 
their  work  and  of  their  personnel  technique.  Labor  "solidarity," 
even  in  so  extreme  a  manifestation  as  the  general  strike,  usually 
represents  a  groping  but  fundamentally  spiritual  movement 
toward  an  organization  of  industry  for  service;  and  to  the  extent 
that  this  is  true  the  progressive  administrator  need  not  seriously 
fear  it. 

(4)  Prior  Breach  of  Agreement  by  the  Employer. — Instances  are 
at  hand  where  workers  feel  that  the  contract  is  already  broken 
by  some  failure  of  the  employer  to  fulfill  his  obligations;  and 
this  then  becomes  their  excuse  for  breaking  it,  or  for  presenting 
new  demands.  Obviously  the  employer's  derilection  does  not 
excuse  the  workers.  It  only  shows  that  where  a  breach  of 
agreement  is  claimed  against  a  union  by  the  employer,  it  is 
important  not  to  jump  too  hastily  to  the  conclusion  that  the 
workers  alone  are  in  the  wrong.  It  would,  of  course,  be  ex- 
traordinary if  with  the  hundreds  of  agreements  which  are 
entered  into  yearly,  there  were  not  some  in  which  the  breach 
was  on  the  management  side.  In  other  words  it  is  necessary 
to  judge  each  case  on  its  own  merits. 

But,  it  may  be  said,  a  contract  is  a  contract;  and  there  should 
be  some  means  of  redress,  some  accountability  of  the  union 
today  for  its  actions  in  breach  of  agreement.  If  the  union 
chooses  to  indulge  in  arbitrary  methods  of  defense,  it  should 
realize  how  truly  expensive  and  hazardous  they  are.  This  view 
is  so  frequently  urged  as  to  require  careful  scrutiny. 

The  first  point  to  be  clearly  established  is  the  extent  to  which 


BUSINESS  VALUE  OF  THE  COLLECTIVE  BARGAIN      465 

the  collective  agreement  is  a  "contract."  We  quote  extensively 
an  opinion  on  this  question,  not  because  it  argues  any  the  less 
for  having  unions  feel  accountable  and  responsible  for  living 
up  to  agreements,  but  rather  to  make  clear  the  legal  status  of  the 
union  as  compared  to  that  of  the  corporation. 

"The  difference  between  a  labor  union  and  a  business  organization, 
and  between  a  trade  agreement  and  an  ordinary  contract,  is  well  ex- 
pressed in  a  recent  decision  of  the  Supreme  Court  of  Kentucky:  'A 
labor  union,  as  such,  engages  in  no  business  enterprise.  It  has  not  the 
power,  and  does  not  undertake,  to  supply  employers  with  workmen.  It 
does  not,  and  cannot,  bind  its  members  to  a  service  for  a  definite,  or 
any  period  of  time,  or  even  to  accept  the  wages  and  regulations  which  it 
might  have  induced  an  employer  to  adopt  in  the  conduct  of  his  busi- 
ness. Its  function  is  to  induce  employers  to  establish  usages  in  respect 
to  wages  and  working  conditions  which  are  fair,  reasonable,  and  humane, 
leaving  to  its  members  each  to  determine  for  himself  whether  or  not  and 
for  what  length  of  time  he  will  contract  with  reference  to  such  usages. 
....  It  (the  trade  agreement)  is  just  what  it,  on  its  face,  purports  to  be 
and  nothing  more.  It  is  merely  a  memorandum  of  the  rates  of  pay 
and  regulations  governing,  for  the  period  designated,  enginemen  em- 
ployed on  the  Chattanooga  division  of  the  company's  railway.  Having 
been  signed  by  the  appellee,  it  is  evidence  of  its  intention,  in  the  conduct 
of  its  business  with  enginemen  on  said  division,  to  be  governed  by  the 
wages  and  rules,  and  for  the  time  therein  stipulated.  Enginemen  in, 
or  entering,  its  service  during  the  time  limit  contract  with  reference  to 
it.  There  is  on  its  face  no  consideration  for  its  execution.  It  is  there- 
fore not  a  contract.  It  is  not  an  offer,  for  none  of  its  terms  can  be  con- 
strued as  a  proposal.  It  comes  squarely  within  the  definition  of  usage 
as  defined  in  Byrd  v.  Beall,  150  Ala.  122,  43  So.  749.  There  the  court, 
in  defining  usage,  said  '  usage '  refers  to  '  an  established  method  of  deal- 
ing, adopted  in  a  particular  place,  or  by  those  engaged  in  a  particular 
vocation  or  trade,  which  acquires  legal  force,  because  people  make  con- 
tracts with  reference  to  it.' 

"The  so-called  'contract'  which  a  trade  union  makes  with  an  em- 
ployer or  an  employers'  association  is  merely  a  'gentlemen's  agreement,' 
a  mutual  understanding,  not  enforceable  against  anybody.  It  is  an 
understanding  that,  when  the  real  labor  contract  is  made  between  the 
individual  employer  and  the  individual  employee,  it  shall  be  made  ac- 
cording to  the  terms  previously  agreed  upon.  But  there  is  no  legal 
penalty  if  the  individual  contract  is  made  differently.  To  enforce  the 
collective  contract  would  be  to  deny  the  individual's  liberty  to  make  his 
own  contract."1 

COMMONS     and     ANDREWS.     Principles     of    Labor    Legislation,    pp. 
117-118. 
30 


466  PERSONNEL  ADMINISTRATION 

In  some  cases  the  placing  of  a  bond  by  both  sides  as  a  guaran- 
tee of  fulfillment  of  the  agreement  has  been  used  with  a  measure 
of  success.  But  the  usual  counter-proposal  of  employers  has 
been  to  incorporate  the  unions,  in  order  that  they  may  thus 
be  made  subject  to  suit  if  "breach  of  contract"  or  any  illegal 
act  occurs.  Indeed,  some  employers  have  claimed  that  if  the 
unions  were  only  "responsible  organizations,"  they  would  be 
willing  to  deal  with  them.  This  sounds  eminently  reasonable. 
Logically  and  abstractly,  there  would  seem  to  be  no  serious 
objection  to  incorporation  of  unions.  But  we  are  not  dealing  in 
abstractions  nor  in  matters  where  legal  consistency  is  the  only 
criterion.  When  we  examine  the  present  strength  of  trade 
unions  and  their  primary  purpose,  difficulties  begin  to  appear. 

Unions  exist  to  protect  by  group  action  the  fundamental 
interests  of  employees;  to  assure  in  the  first  instance  earnings 
and  conditions  of  work  sufficiently  adequate  to  preserve  a 
healthy  and  happy  standard  of  living.  Under  present  circum- 
stances organized  workers  receive  amounts  too  close  to  the  mini- 
mum of  subsistence  to  make  it  possible  for  them  to  lose 
money  invested  in  their  labor  organization  without  such  loss 
jeopardizing  their  very  livelihood.  Property  can  stand  loss  by 
penalty;  life  at  or  near  the  margin  of  subsistence  cannot. 

Moreover,  until  the  law  specifically  concedes  and  recognizes 
the  right  to  organize  in  protection  of  one's  livelihood  as  being 
at  least  equal  to  the  right  to  protect  property,  the  incorporation 
of  unions  would  mean  the  legal  recognition  of  bodies  which 
must  resort  to  methods  which  are  now  held  illegal  in  order  to 
carry  out  their  fundamental  purposes.  It  is  at  this  moment 
by  no  means  clear  what  the  legal  position  of  the  trade  union  is. 
Court  decisions  have  in  recent  years  construed  trade  union  acti- 
vity as  being  a  conspiracy  in  restraint  of  trade,  as  an  effort  to 
deprive  employers  of  property  without  due  process  of  law,  and 
as  an  impairment  of  the  right  of  freedom  of  contract.  In  other 
words,  to  incorporate  unions  would  make  it  easier  than  it  now 
is  to  penalize  those  bodies  for  acts  which  are  or  might  be 
declared  "illegal,"  however  humanly  justifiable  they  may  be. 

The  strike,  clumsy  and  costly  a  weapon  as  it  may  be,  is  labor's 
most  powerful  instrument  of  self-protection.  Yet  if  in  striking 
unions  were  held  to  be  conspiracies  in  restraint  of  trade,  agents 
depriving  employers  of  property  without  due  process  of  law, 
or  agents  causing  workers  to  break  individual  contracts,  they  could 


BUSINESS  VALUE  OF  THE  COLLECTIVE  BARGAIN      467 

be  sued  to  the  limit  and  their  effectiveness  thereby  nullified. 
It  should  be  axiomatic  that  if  a  body  becomes  legal,  as  the  union 
would  if  incorporated,  the  only  course  which  it  can  pursue  to 
fulfill  its  legally  defined  purpose,  would  be  legal  also.  This 
is  not  saying  that  all  its  acts  are  therefore  legal.  Legality 
would,  however,  have  to  be  interpreted,  not  as  it  so  often  is 
today  in  terms  of  abstract  concepts  of  "property  rights,"  "free- 
dom of  contract,"  "equality,"  etc.,  but  in  terms  of  the  raison 
d'etre  of  the  organization  and  of  the  human  context  and  con- 
sequences of  the  particular  acts  in  question. 

The  means  are  already  at  hand  to  prosecute  union  leaders 
for  criminal  acts.  Damage  suits  may  be  used  to  meet  definite 
offenses.  Indeed,  so  formidable  might  their  use  become  that 
Commons  and  Andrews  are  led  to  say: 

"The  menace  of  the  damage  suit  is  best  brought  out  in  the  contrast 
between  the  position  of  the  members  of  labor  unions  and  that  of  stock- 
holders in  corporations.  It  is  evident  that  labor  unions  are  very  much 
looser  organizations  than  are  corporations.  Unions  must  entrust  their 
officers  with  great  power;  the  rank  and  file  of  the  members  know  little 
about  what  the  officers  are  doing.  Even  when  members  disapprove  of 
the  actions  of  the  officers,  they  can  ill  afford  to  get  out  of  the  union,  as 
they  would  lose  their  insurance  benefits  and  in  many  industries  would 
find  it  difficult  to  get  a  job.  These  are  reasons  why  the  members  of 
labor  unions  should  not  be  held  to  the  same  accountability  for  acts  done 
in  their  behalf  as  are  stockholders  in  corporations.  But  in  the  United 
States  the  members  of  labor  unions  have  the  greater  liability.  For  a 
tort  committed  in  behalf  of  a  corporation,  the  stockholders  can  be 
held  only  to  the  extent  of  their  stock  subscription,  or  double  the  amount, 
under  certain  laws  regulating  banks.  The  members  of  labor  unions  are 
responsible  without  limit  for  tortious  acts  done  in  their  behalf."1 

We  cannot  repeat  too  emphatically  that  it  is  essential  to  create 
conditions  under  which  both  corporations  and  employees  will 
feel  and  act  as  responsibly  as  possible.  Indeed  such  a  conscious 
assumption  of  responsibility  for  operating  the  industry  as  a 
social  service,  is  basic  to  industrial  amity.  But  under  existing 
legal  and  social  arrangements,  responsibility  cannot  be  fostered 
by  compulsory  enactments.  Admittedly  as  matters  stand 
today  the  cultivation  of  such  a  sense  of  responsibility  is  not  the 
work  of  a  year;  the  attitude  of  workers  and  employers  alike  has 
not  been  one  which  stressed  a  common  obligation  to  the  com- 

1  COMMONS  and  ANDREWS.     Principles  of  Labor  Legislation,  pp.  121-122. 


468  PERSONNEL  ADMINISTRATION 

munity.  But  like  other  values  of  attitude  and  motive,  the  sense 
of  responsibility  can  be  fostered  and  universalized.  It  can  be 
fostered  by  assuring  to  all  parties  the  fullest  protection  to  organize 
and  deal  together  in  open  and  honorable  ways;  and  by  fostering 
throughout  the  community  an  attitude  which  sees  in  industry 
a  public  trust,  and  in  work  a  public  service. 

As  matters  stand  today,  incorporation  of  unions  would  have,  in 
short,  a  tendency  to  defeat  the  very  features  in  them  which  it  is 
from  every  point  of  view  advantageous  to  preserve,  namely,  the 
assured,  effective  and  continuous  protection  of  the  workers' 
rights  by  their  own  self-constituted  organizations.  This  brings 
us  to  a  specific  statement  of  a  further  value  in  the  collective 
bargain. 

The  collective  bargain  offers  the  only  real  protection  to  the 
employer  against  his  natural  impulse  to  economize  in  the  easiest 
but  ultimately  most  expensive  way.  The  best  reason,  for  ex- 
ample, why  the  economy  of  high  wages  is  not  more  readily 
seen  by  employers  is  that  the  pressure  of  competition  and  the 
demands  of  investors  impel  them  to  the  most  obvious  and 
immediate  retrenchments.  Wage  rates  are  one  of  the  few  items 
more  or  less  within  the  employer's  control.  The  price  of  raw 
material  is,  for  immediate  purposes,  fixed;  machinery  costs  are 
given ;  selling  costs  are  known ;  prices  are  set  within  narrow  limits. 
Economy — the  obvious  and  superficial  economy — seems  to 
lie  in  keeping  the  wage  bill  low.  Even  when  managements 
understand  the  sources  of  real  economy  in  better  equipment, 
better  routing  of  work,  more  economical  methods  of  purchase 
and  sales,  and  better  selection  and  training  of  workers,  there 
may  be  initial  expense  and  effort  attached  which  look  prohibitive. 
But  more  often  inertia  and  ignorance  of  the  science  of  manage- 
ment prevent  employers  from  getting  to  the  sources  of  leakage. 
Careless  planning  of  work  within  the  shop  or  in  relation  to  sales, 
with  resulting  congestion  in  one  department  and  idleness  in 
another;  poor  handling  of  materials;  meager  production  records; 
bad  arrangement  of  inachim-;  insufficient  light  or  uir;  inadcquittc 
training  of  workers;  to  eliminate  all  these  possible  wastes 
for  which  the  management  is  responsible  is  certainly  not  an 
easy  way  out. 

Moreover,  it  is  hard  to  believe  that  the  same  group  of  men 
can  do  as  much  or  more  in  eight  hours  than  they  can  in  nine; 
or  perhaps  do  more  or  better  work  on  $30  a  week  than  they  did 


BUSINESS  VALUE  OF  THE  COLLECTIVE  BARGAIN      469 

on  $25.  Evidence  exists  to  prove  that  such  things  have  hap- 
pened. But  each  employer's  contention  that  his  business 
"is  different"  can  be  confidently  met  only  by  insisting  that 
the  results  of  possible  new  policies  and  methods  must  be  de- 
termined by  trial. 

Hence,  the  employer  needs  constant  and  effective  protection 
from  the  temptation  to  short-sighted  economy  in  his  wage  bill 
and  in  prolonged  hours  of  labor;  and  an  active  inducement 
to  improve  those  terms  of  employment. 

The  protection  thus  secured  by  union  standards  for  the 
employee  is  definitely  valuable  for  the  employer.  The  collective 
bargain  assures  the  worker  a  continuance  of  living  and  working 
standards  already  gained ;  and  holds  clearly  before  the  manage- 
ment the  useful  idea  that  those  standards  cannot  be  molested 
without  endangering  the  energy  and  vitality  of  the  workers  and 
their  families. 

There  is  another  value  in  the  collective  bargain  which  is  greater, 
as  the  same  agreement  applies  over  a  district,  or  as  practically 
uniform  terms  are  included  in  the  several  agreements  in  a  locality. 
This  is  the  value  of  uniform  labor  standards  below  which  no 
competitor  is  allowed  to  produce.  Every  manufacturer  is 
familiar  with  the  condition  which  Mr.  Mackenzie-King  has 
called  the  "law  of  competing  standards."1  which  states  that 
there  is  a  tendency  for  the  terms  and  conditions  of  employment 
to  fall  to  the  level  of  the  lowest  terms  and  worst  conditions  which 
are  offered  in  the  industry. 

This  tendency  is  active  despite  the  desires  and  efforts  of  the 
more  intelligent  managers  in  an  industry;  that  is,  it  is  active 
unless  there  is  an  industry-wide  organization  of  the  workers  to 
enforce  upon  all  employers  alike  certain  defined  minimum  standards. 
The  activity  of  such  a  workers'  organization  tends,  as  we  see 
it  for  example  in  the  garment  and  boot  and  shoe  trades,  to 
discourage  the  small-scale  family  shop  and  the  marginal  shop, 
and  to  offer  encouragement  to  those  better  managed  units  which 
have  capital  enough  to  provide  adequate  working  accommoda- 
tions and  reasonable  permanency  of  employment.  In  other 
words,  such  activity  on  the  part  of  the  organized  workers  has 
proved  to  be  a  stabilizing  influence  upon  the  working  methods 
and  human  standards  of  an  industry. 

A  lesser  value  of  collective  dealing  which   should   be   con- 

1  MACKENZIE- KING,  W.  L.     Industry  and  Humanity,  p.  67. 


470  PERSONNEL  ADMINISTRATION 

sidered  in  this  connection  is  that  of  having  the  skill  and  com- 
petence of  each  worker  approximately  known  because  of  his 
membership  in  an  organization  where  certain  titles  of  occupations 
and  standards  of  efficiency  for  an  occupation  are  established 
and  known  over  a  district.  It  is,  for  example,  important  to 
have  some  agreed  connotation  for  the  word  "machinist"  or 
"carpenter"  or  "riveter."  It  is  increasingly  valuable  to  have 
uniform  names  for  jobs;  and  to  have  defined  standards  of  work- 
manship attaching  to  those  names.  It  is  coming  to  be  recognized 
as  a  real  industrial  asset  to  have  the  name  "boilermaker"  when 
attached  to  a  worker  mean  a  man  who  has  passed  through  a 
certain  period  of  apprenticeship  or  training  at  certain  kinds  of 
work  and  who  by  virtue  of  his  title  is  qualified  to  perform  a  certain 
range  of  jobs.  Manifestly  it  is  almost  impossible  to  universalize 
titles  and  craft  standards  in  the  absence  of  a  fairly  inclusive 
organization  of  the  workers  which  can  help  to  maintain  both 
titles  and  standards. 

But  there  is  a  practical  difficulty  in  the  way  of  realizing  this 
value,  as  things  are  today.  Under  the  constant  urgency  of 
securing  "  100  per  cent,  organization,"  the  standards  of  crafts- 
manship are  too  often  not  rigorously  upheld  by  the  union  if  the 
applicant  can  satisfy  his  fellows  that  he  will  make  a  "good 
member."  The  bars  thus  tend  to  be  let  down  more  frequently 
than  is  wholesome  for  the  maintenance  of  careful  classification  of 
skill,  and  of  the  prestige  of  the  craft.  It  is  only  another  instance 
of  how,  as  long  as  the  union's  attention  has  to  be  fastened  on 
self-perpetuation,  it  cannot  simultaneously  be  fastened  on  the 
maintenance  of  craft  standards  and  the  solution  of  other  pro- 
duction problems. 

The  Educational  Values. — The  drawing  up  and  administra- 
tion of  collective  bargains  has  also  educational  consequences  for 
the  workers  which  employers  should  not  ignore.  Cases  have  not 
infrequently  arisen  where  employers  have  said  to  the  unions: 
"We  cannot  grant  your  demands  and  stay  in  business,  as  long  as 
the  employers  in  the  other  manufacturing  centers  in  this  indu>t  ry 
do  not  have  to  deal  with  unions  and  live  up  to  these  terms  and 
conditions  which  you  demand.  Go  to  those  cities;  organize  the 
plants  there  and  get  them  on  an  approximately  equal  competitive 
basis;  then  come  back  and  we'll  consider  the  demands." 

In  such  a  situation  workers  come  to  realize  the  extent  of  their 
community  of  interest  with  those  of  management.  They  come 


BUSINESS  VALUE  OF  THE  COLLECTIVE  BARGAIN      471 

to  realize  the  number  and  intricacy  of  the  factors  involved  in 
effecting  wage  and  hour  settlements.  They  come  to  know  that 
there  should  be  a  fact  basis  for  those  important  decisions  which 
concern  them.  This  knowledge  among  the  workers  tends  pre- 
sently to  increase  the  stability  and  uniformity  of  the  labor  stand- 
ards of  an  industry;  for  it  means  that  the  union  brings  pressure 
upon  the  wayward  and  backward  employers  in  a  way  that  the 
other  employers  never  can,  no  matter  how  progressive  their  own 
individual  policies  may  be. 

It  is  finally  important  to  consider  a  merit  of  collective  bargaining 
which  is  in  a  sense  largely  potential  today.  We  have  pointed 
out  that  a  sense  of  security  of  livelihood  is  a  prerequisite  condi- 
tion of  interest  in  work.  Only  the  worker  whose  mind  is  free 
from  financial  anxiety  and  uncertainty  is  in  a  mental  condition 
to  interest  himself  thoroughly  in  his  work.  It  is  true  that  all 
who  are  thus  free,  are  not  interested;  but  this  freedom  is  one 
necessary  condition,  and  with  it  given  (as  it  is  to  a  certain  extent 
under  a  collective  bargain),  it  is  possible  to  take  the  other  steps 
necessary  to  secure  positive  interest. 

We  have  already  discussed  these  steps  in  previous  chapters;  and 
it  only  remains  to  point  out  here  that  the  collective  agreement 
offers  the  logical  place  in  which  to  define  and  agree  upon  stand- 
ards of  amounts  of  work  and  to  develop  the  interest  to  which  this 
process  of  joint  determination  almost  inevitably  gives  rise.  We 
know  of  only  one  or  two  isolated  cases  where  today  the  union 
bargains  with  the  employer  about  amounts  and  quality  of  work. 
And  in  those  cases  the  agreement  is  not  based  upon  data  secured 
from  the  type  of  scientific  study  which  we  proposed  in  discussing 
job  analysis.  For  this  important  reason  these  instances  do  not 
offer  a  completely  analogous  illustration. 

The  use  of  collective  agreements  for  this  definition  of  work 
standards  is,  therefore,  a  potential  one.  But  by  this  means  of 
deciding  them  collectively,  it  will  be  possible  to  develop  pro- 
ductivity to  a  degree  now  quite  unrealized.1 

.Subject  Matter  of  the  Collective  Agreement. — We  are  brought 
logically  at  this  point  to  ask:  What  terms  and  subject  matter 
should  the  agreement  include,  if  it  is  to  have  this  maximum  busi- 
ness and  social  value? 

In  enumerating  the  essential  items  of  a  joint  contract,  we  are 

1  There  are  now  encouraging  evidences  in  the  needle  trades  of  a  willing- 
ness on  both  sides  to  come  to  agreement  on  standards  of  output. 


472  PERSONNEL  ADMINISTRATION 

assuming  that  no  other  operating  document  is  in  effect  between 
the  parties.  As  we  shall  see  in  discussing  national  industrial 
councils,  there  is  in  progress  a  new  development  in  industrial 
constitutionalism,  under  which  certain  matters  now  necessarily 
covered  in  the  collective  bargain,  might  be  decided  once  and  for 
all  in  the  constitution  of  the  industry.  But  in  the  absence  of 
such  a  body  of  basic  law,  there  will  be  the  need  of  specific  defi- 
nition covering  a  number  of  problems.  This  definition  need  not, 
however,  be  a  part  of  the  actual  instrument  under  which  joint 
dealings  occur.  There  is  much  to  be  said  for  a  type  of  agreement 
which  is  extremely  simple  in  form,  leaving  all  detailed  provisions 
to  be  made  from  time  to  time  as  new  conditions  arise.  But  it  is, 
under  any  method,  important  to  have  in  mind  the  possible  sources 
of  disagreement  which  should  be  defined  in  some  way  to  mutual 
satisfaction.  For  this  reason  we  list  the  following  matters  con- 
cerning which  some  understanding  is  highly  desirable: 

(a)  Hours. 

This  should  include  a  statement  of  hours  per  day  and  per  week, 
opening  and  closing  times,  vacation  provisions,  agreed  holidays, 
rest  periods,  etc.  There  should  also  be  agreed  restrictions  on  the 
amount  of  overtime,  night  work  and  Sunday  work. 

(6)  Work. 

This  should  include  a  statement  as  to  amounts  of  work  at  each 
job  in  each  of  the  agreed  number  of  grades  (see  Chapter  XIX). 
This  should  be  provided  both  for  week  and  piece  work. 

(c)  Pay. 

There  should  be  a  statement  of  amounts  of  pay  in  relation  to 
each  of  these  grades  of  work;  provisions  regarding  overtime  pay, 
special  rates  for  night  work,  Sunday  and  holiday  work. 

There  should  also  be  a  provision  that  if  the  cost  of  living  rises 
during  the  life  of  the  part  of  the  agreement  relating  to  wages  by 
more  than  an  agreed  amount,  there  will  be  a  reconsideration  of 
wage  rates. 

(d)  Standards  of  physical  working  conditions. 

(e)  Provision  for  joint  machinery,  first  within  the  plant,  then  with 

agreed  outside  persons,  for  the  purpose  of: 

1.  Administration  and  enforcement  of  the  agreement. 

2.  Consideration  of  grievances. 

3.  Interpretation  of  the  agreement. 

4.  Amendment  of  agreement. 

5.  Renewal  of  agreement. 


BUSINESS  VALUE  OF  THE  COLLECTIVE  BARGAIN      473 

6.  Terms  of  admission  of  new  workers. 

7.  Terms  of  discharge. 

8.  Terms  of  promotion. 

9.  Terms  of  introduction  of  new  machinery  and  changes 
in  process. 

10.  Study  to  determine  standards  of  production. 
(/)  Definition  of  the  scope  of  joint  dealing. 
(g)  Date  of  expiration  of  agreement  (or,  if  it  is  in  perpetuo,  of 
those  parts  of  it  relating  to  wages). 

Careful  study  of  this  list  will  suggest  why  it  is  that  collective 
bargaining  in  the  past  has  not  always  been  as  mutually  satis- 
factory as  it  might  have  been.  Some  of  the  past  omissions  have 
been  due  to  careless  and  unbusinesslike  procedure;  some  to  lack 
of  vision  on  one  side  or  the  other;  some  to  an  unduly  narrow  con- 
ception of  the  purpose  of  collective  bargaining.  In  so  far  as  the 
fault  is  a  matter  of  omission  only,  it  is  easily  repaired.  But 
there  are  real  shortcomings  in  the  collective  bargain  as  now  prac- 
ticed which  should  be  faced. 

Shortcomings  of  the  Collective  Bargain. — The  most  fundamen- 
tal criticism  of  the  collective  agreement  as  it  is  now  used,  is 
that  it  concerns  itself  primarily  if  not  exclusively  with  problems 
of  the  distribution  of  a  portion  of  the  income  from  the  business. 
We  have  explained  why  this  has  had  to  be  so  in  the  past;  but 
we  have  also  indicated  why  in  the  future  this  need  be  less  and 
less  true.  The  key  to  an  understanding  of  past  and  present 
union  activities  is  a  realization  that  unions  have  been  bodies  of 
people  acting  together  as  consumers.  They  have  been  primarily 
concerned  with  a  standard  of  life.  This  has  been  not  only  de- 
fensible but  essential.  But  it  has  meant  that  the  interest  of  the 
union,  and  too  often  the  interest  of  its  members,  was  less  in 
shop  affairs  than  in  the  rewards  for  their  labors.  They  had  not, 
so  to  speak,  gone  behind  the  returns. 

Perhaps  it  will  now  be  evident  why  we  have  so  stressed  this  idea 
of  joint  conference  on  work  as  well  as  pay.  We  find  agreement 
on  job  analysis  and  job  determination  to  be  the  bed-rock  on 
which  all  future  joint  dealings  should  be  based.  This  new 
subject  of  conference  has  the  incalculable  value  of  gradually 
shifting  the  emphasis  and  point  of  view  from  issues  surrounding 
distribution  to  those  surrounding  production.  Not  that  this 
means  the  workers  are  to  get  any  less  of  the  total  income.  It 


474  PERSONNEL  ADMINISTRATION 

means  rather  that  they  will  have  become  so  assuredly  and  avow- 
edly partners  in  the  distribution,  that  this  is  taken  for  granted; 
and  attention  is  turned  toward  production. 

It  may,  therefore,  be  fairly  asserted  that  the  usual  collective 
bargain  of  today  errs  on  the  side  of  too  great  attention  to  the 
division  of  the  income. 

Again,  collective  bargaining  confined  to  one  plant,  or  even  to 
one  district,  may  give  temporary  advantage  in  the  selling  mar- 
ket to  those  plants  where  union  conditions  are  not  enforced. 
This  is  not  always  true,  since  the  union  conditions  may  increase 
production  and  lower  costs.  But  where  the  differences  in  terms 
are  extreme,  the  isolated  unionized  plant  may  be  at  a  temporary 
disadvantage.  It  is,  indeed,  unfair  for  such  a  shop  to  be  pitted 
against  the  efforts  of  the  shop  of  the  most  unscrupulous  and 
selfish  non-union  employer.  And  there  is  no  relief  of  permanent 
value  short  of  having  these  other  plants  brought  under  similar 
conditions  of  collective  dealing.  In  short,  this  is  not  so  much  a 
shortcoming  of  collective  bargaining,  as  it  is  a  result  of  its  slow 
extension.  What  is  increasingly  needed  is  joint  action  not  con- 
fined only  to  single  plants  or  localities  and  not  restricted  merely 
to  consideration  of  the  immediate  terms  of  employment. 

It  is  this  next  step  in  the  hierarchy  of  industrial  government 
which  we  shall  consider  in  discussing  national  industrial  councils. 
For  there  is  clearly  developing  a  crying  need,  from  the  point  of 
view  of  effective  business  organization,  for  a  basis  of  common 
action  between  the  organized  employers  and  the  organized 
workers  of  an  industry  on  a  district  and  on  a  national  scale — bodies 
which  shall  be  influential  in  determining  common  policies  on 
those  fundamental  matters  of  production  and  labor  relations 
where  competition  has  proved  destructive,  demoralizing  and 
hurtful  to  all. 

Objections  to  the  Collective  Bargain. — Already  in  assessing 
the  business  values  of  joint  bargaining  we  have  considered  some 
of  the  familiar  objections.  It  will  now  be  useful  to  summarize 
these  and  to  complete  the  list  of  objections  which  deserve  serious 
consideration.  We  shall,  therefore,  state  these  objections  in  the 
terms  most  usually  employed. 

(a)  Workers  do  not  want  collective  bargaining;  they  prefer 
the  liberty  of  individual  contract. 

In  so  far  as  this  objection  is  not  one  which  the  legally  minded 
employer  has  put  into  the  mouths  of  the  workers,  it  is  on  a  par 


BUSINESS  VALUE  OF  THE  COLLECTIVE  BARGAIN      475 

with  the  citizen's  objection  that  he  does  not  want  to  send  his 
son  to  school,  or  does  not  want  to  pay  taxes  to  provide  improve- 
ments on  his  neighbor's  street.  "The  illusory  freedom  of  the 
individual  bargain, "  says  Mr.  Webb,  "must  give  way  to  the  com- 
pulsory freedom  of  the  collective  bargain."  There  will,  of  course 
always  be  workers  who  are  acutely  individualistic  and  reluctant 
to  align  themselves  with  labor  organizations  because  of  fear, 
indifference,  inertia,  pride,  stubbornness  or  other  causes.  But 
their  attitude  offers  no  more  valid  objection  to  the  claims  in 
behalf  of  joint  dealing,  than  the  selfish  father's  or  taxpayer's 
objections  offer  to  education  or  taxes. 

The  objection  arises  out  of  a  conception  of  individual  freedom 
and  of  the  ways  it  may  be  secured,  which  the  twentieth  century 
has  perforce  outgrown.  Liberty  is  increasingly  being  seen  as  a 
state  of  affairs  in  which  some  moderate  restraints  upon  individual 
whim  are  a  necessary  condition  of  the  true  freedom  of  large  num- 
bers of  people. 

(&)  If  the  employer  treats  his  workers  fairly,  there  is  no  need 
for  a  working  class  organization. 

This  objection  we  have  already  considered  sufficiently  in  ana- 
lyzing the  legitimacy  and  primary  value  of  a  degree  of  self-interest 
and  self -definition  of  that  interest,  and  in  stating  the  soundness 
of  the  principle  of  representation,  of  all  groups  having  special 
interests  in  the  conduct  of  an  enterprise. 

(c)  Unions  go  out  on  a  sympathetic  strike  when  they  have 
no  direct  dispute  with  their  employer. 

We  have  seen  that  this  has  been  true  in  some  cases. 

(d)  Unions  do  not  keep  their  agreements. 

That  this  statement  also  contains  a  measure  of  truth  cannot 
be  denied.  It  would  be  true  also  to  say  that  employers  do  not 
keep  their  agreements.  It  is,  in  both  cases,  a  too  sweeping 
generalization.  We  have  already  considered  the  proposal  of 
incorporation  in  order  to  make  unions  accountable  and  respon- 
sible. On  the  whole  it  is  our  conclusion  that  maximum  success 
in  holding  both  sides  to  their  word  results  from  having  strong 
organization  on  both  sides,  amicable  personal  relations  between 
the  leaders  on  both  sides,  and  a  common  desire  for  fair  play. 

(e)  Unions  make  it  difficult  to  discharge  the  inefficient. 

To  the  extent  that  this  is  true,  a  remedy  lies  at  hand  in  securing 
joint  agreement  on  standards  of  workmanship  at  each  job.  As 
to  other  causes  for  discharge,  there  should  also  be  a  definite  joint 


476  PERSONNEL  ADMINISTRATION 

understanding  and  method  of  adjustment. 

(/)  Unions  make  it  difficult  to  reward  the  efficient;  they  put  a 
premium  upon  mediocrity. 

There  is  a  certain  force  in  this  objection;  but  the  condition 
is  not  in  any  way  inherent  in  collective  bargaining.  It  is  merely 
a  characteristic  of  some  collective  bargains  that  are  not  well- 
drawn,  and  of  collective  dealings  which  do  not  treat  of  amounts 
of  work.  Moreover,  some  unions  contend  with  justice  that 
their  union  wage  scale  is  only  a  minimum  scale.  Also, 
the  limited  extent  to  which  superior  individual  workers  in  non- 
union shops  are  paid  above  the  going  rate  does  not  indicate  that 
there  is  any  widespread  desire  among  employers  to  pay  high 
differential  rates. 

(g)  Unions  limit  output  and  restrict  the  use  of  labor  saving 
machinery. 

This  is  another  sweeping  generalization  which  has  a  certain 
fact  basis.  It  would,  however,  be  equally  true  to  say  that  all 
workers  do  both  of  these  things.  It  is  an  almost  inevitable 
consequence  of  a  condition  of  bargaining  over  pay  but  not  over 
work,  and  of  a  condition  of  economic  insecurity.  To  give  serious 
weight  to  these  objections  in  evaluating  collective  dealing  is  to 
attribute  a  result  of  general  causes  to  an  only  incidental  specific 
cause.  Moreover  as  we  have  shown,  relief  from  a  policy  of 
limitation  is  only  to  be  found  in  the  joint  conference  and  agree- 
ment on  amounts  of  work  which  collective  bargaining  can  and 
should  entail. 

(h)  Unions  create  confusion  and  interruption  of  work  by  juris- 
dictional  disputes  over  which  the  employer  has  no  control. 

There  is  a  measure  of  truth  in  this  criticism,  although  it  is  a 
diminishing  feature  of  union  activity.  As  soon  as  federation 
and  joint  conference  on  jurisdictional  problems  take  place,  the 
annoyances  of  interruptions  of  work  become  increasingly  negli- 
gible. 

(f)  The  presence  of  unions  and  collective  contracts  submits  the 
employer  to  negotiations  with  and  control  of  certain  items  by  an 
outside  agency;  the  unions  tend  to  "run  the  shop." 

We  have  already  shown  that  such  "outside  interference"  is 
really  a  benefit  to  the  employer  since  it  helps  to  secure  adequate 
protection  of  the  workers'  interests.  It  is,  moreover,  not  an 
"outside"  influence,  if  only  managers  will  accustom  themselves 
to  viewing  the  problems  of  all  the  shops  of  an  industry  as  inter- 


BUSINESS  VALUE  OF  THE  COLLECTIVE  BARGAIN      477 

related  and  interacting.  Some  of  the  most  regrettable  short- 
comings in  managerial  thinking  today  are  due  to  this  failure  to 
realize  that  no  shop  works  or  can  work  unto  itself  alone.  In  the 
most  vital  problems  of  labor  relations  it  is  increasingly  imperative 
for  the  manager  to  think  in  terms,  not  of  the  shop,  but  of  all  the 
shops  of  an  industry,  And  the  union  agent,  as  the  spokesman 
of  the  organization  of  the  workers  of  an  industry  at  large,  is  as 
necessary  a  functionary  as  the  executive  secretary  or  the  legal 
counsel  of  the  trade  association.  To  stigmatize  him  as  an 
"outsider"  is  simply  to  ignore  the  necessarily  elaborate  structure 
of  modern  industrial  government. 

Where  the  objection  that  the  union  tries  to  "run  the  shop" 
has  any  foundation,  it  is  due  to  abuses  of  the  collective  principle 
for  which  both  sides  are  probably  to  blame.  The  objection 
assumes  that  employees'  efforts  toward  control  are  irresponsible, 
unreasonable  and  arbitrary.  Such  may  in  individual  instances 
be  the  case.  But  in  the  machinery  which  the  collective  bargain 
should  provide,  if  it  is  properly  drawn,  lies  the  remedy  for  any 
serious  ambiguity  and  discord  over  shop  control.  Often,  also, 
unduly  arbitrary  conduct  on  the  part  of  workers  is  due  to  igno- 
rance of  the  relevant  facts;  a  condition  which  can  be  remedied 
by  proper  research  and  publicity. 

(j)  Union  demands  culminate  in  a  stand  for  the  "closed 
shop."  This  restricts  the  freedom  of  any  worker  who  does  not 
join,  and  hence  is  "un-American." 

It  is  true  that  unionism  in  order  to  fulfil  its  purpose — indeed  in 
order  to  be  sure  of  its  existence — logically  implies  that  the  shop 
shall  at  least  give  preference  in  employment  to  union  workers. 
Otherwise  the  union  members  employed  would  be  gradually 
superseded  and  the  collective  agreement  would  no  longer  have 
binding  effect  on  the  company  in  its  dealings  with  new  workers. 
If  the  union  is  to  be  responsible  in  any  degree  for  upholding  its 
end  of  an  agreement  it  must  have  assurances  that  the  great 
majority  of  employees  are  under  its  control. 

i  The  only  question  of  fundamental  importance  which  may  be 
raised  in  this  connection  relates  to  the  ease  with  which  one  may 
enter  the  union.  It  may  be  that  in  certain  cases  the  rules  for 
admission  to  the  union  are  unduly  severe;  and  where  such  a 
union  has  a  "union  shop"  agreement,  hardship  might  result  to 
the  new  non-union  worker  because  of  his  inability  to  meet  the  con- 
ditions of  membership  as  a  condition  of  employment.  But  the 


478  PERSONNEL  ADMINISTRATION 

usual  case  in  a  union  shop  is  that  there  is  a  reasonably  "open 
union" — that  is,  membership  is  easily  secured.  Hence,  so  long  as 
there  is  an  open  union  in  a  union  or  preferential  shop,  there  is  no 
serious  infringement  of  any  individual's  freedom — if  the  condi- 
tions under  which  any  reasonable  measure  of  fundamental  freedom 
can  today  be  assured,  are  understood. 

(k)  A  final  objection  sums  up  the  feeling  of  opposition  when 
it  says  that  collective  bargaining  is  "all  right  in  principle  but  not 
in  practice."  By  this  statement  the  manager  usually  means  that 
he  has  not  the  patience  or  the  faith  in  the  positive  elements  of 
human  nature  to  undertake  the  mutually  educational  project 
which  collective  bargaining  really  is.  Or  he  may  mean  that  his 
own  plant  "is  not  ready  for  collective  bargaining;"  or  that 
while  recognizing  it  as  eventually  inevitable,  he  desires  "to  be 
boss  in  his  own  shop"  as  long  as  possible. 

The  manager  who  is  disposed  to  admit  that  despite  its  short- 
comings the  collective  bargain  is  probably  the  direction  which 
negotiation  with  employees  must  today  take,  may,  however, 
still  object  that  a  different  kind  of  organization,  a  different  type 
of  leadership,  a  different  prevailing  animus  and  bias  from  those 
now  usually  found  in  unions,  is  required  if  collective  bargaining 
is  to  succeed  as  a  constructive  force.  This  objection,  too,  we 
have  in  a  sense  anticipated  in  saying  that  the  unions  have  tended 
in  the  past  to  act  as  consumers.  The  radical  shift  in  motive  and 
method  involved  in  bringing  them  to  act  as  groups  of  producers 
can  certainly  not  be  ignored  or  slighted.  And  we  have  no  dis- 
position to  under-estimate  how  considerable  may  be  the  change 
required  in  certain  unions  to  create  the  outlook  here  proposed. 
Indeed,  in  some  few  cases  the  power  of  adaptation  to  contempo- 
rary conditions  may  have  disappeared.  Where  this  is  found  to  be 
true,  there  will  be  but  one  solution ;  another  organization  of  the 
workers  must  (and  will)  grow  up  to  supplant  the  old.  We  do 
not  consider  this  to  be  a  usual  necessity.  The  unions'  powers  of 
adaptation  and  development  are  great;  and  in  all  probability 
the  change  in  their  outlook  will  come  as  fast  as  it  can  be  applied 
in  practical  affairs.  We  are  today  not  without  evidences  that 
the  major  union  bodies  possess  in  themselves  the  leaven  of  this 
new  and  constructive  emphasis — this  emphasis  upon  production, 
upon  economy  in  operation,  upon  a  thorough  application  of 
science  to  management. 


BUSINESS  VALUE  OF  THE  COLLECTIVE  BARGAIN      479 

Conclusion. — Our  estimate  of  collective  bargaining  as  a  busi- 
ness value  is  on  the  whole  favorable.  A  much  more  critical 
picture  of  trade  unions  could  easily  have  been  painted  had  we 
cared  to  emphasize  those  unfortunate  cases  of  corruption,  dis- 
honesty, intrigue,  inertia  and  irresponsibility,  which  could  un- 
doubtedly be  cited.  Yet  were  we  to  admit  the  worst  that  may 
be  said  of  unions  and  of  bargaining  with  them,  we  would  still 
be  compelled  to  conclude  that  from  the  business  point  of  view 
it  would  be  necessary  to  create  some  organization  of  employee 
and  working  class  sentiment  for  certain  essentially  business 
purposes. 

Indeed,  employers  are  already  doing  this  in  the  shop  committee 
development;  and  it  is  idle  to  suppose  that  there  will  not  soon 
grow  up  a  degree  of  federated  activity  among  shop  committees 
which  will  form  in  essence  the  same  kind  of  bodies  that  unions 
are.  Organization  of  workers  is  as  essential  to  any  stable  in- 
dustrial structure  as  organization  of  citizens  into  townships, 
municipal  corporations  or  states. 

Collective  action,  the  dealing  of  group  with  group,  associated 
negotiation  of  those  having  one  purpose  and  point  of  view  with 
those  having  another — this  is  necessary  and  valuable  to  the 
employer  today  just  as  are  stable  relations  with  the  banks  and 
with  distributing  organizations.  "Whether  we  will  or  not," 
says  ex-President  Taft,  "the  group  system  is  here  to  stay,  and 
every  statesman  and  every  man  interested  in  public  affairs  must 
recognize  that  it  has  to  be  dealt  with  as  a  condition,  to  be  favored 
in  such  a  way  as  to  minimize  its  abuses  and  to  increase  its 
utility." 

The  practical  business  utility  of  the  collective  transaction  must 
unquestionably  be  increased.  But  this  is  not  the  work  of  a  day 
or  a  year.  It  is  an  enterprise  on  which  every  employer  desirous 
of  creating  goodwill,  mutual  understanding  and  closer  personal 
association  between  managers  and  men,  can  profitably  embark 
as  soon  as  his  workers  also  desire  it.  He  can  commence  through 
shop  committees  on  job  analysis  and  wages  to  establish  a  whole- 
some basis  for  adequate  common  knowledge  and  action.  And  the 
employer  who  is  already  party  to  a  collective  agreement  can  help 
to  make  it  a  more  effective  instrument  in  those  ways  already 
mentioned. 

Progress  is  in  any  case  assured,  as  soon  as  employers  become 
convinced  that  collective  bargaining  properly  conducted  is  one 
of  the  principal  means  of  restoring  interest  in  work,  creating 


480  PERSONNEL  ADMINISTRATION 

a  sense  of  self-respect  and  human  dignity  in  the  workers,  and 
educating  managers  as  well  as  managed  into  their  respective 
responsibilities  for  a  productive  industrial  system. 

Selected  References 

COMMONS,  J.  R.  and  J.  B.  ANDREWS.     Collective  Bargaining.     (In  their 

Principles  of  Labor  Legislation,  1916,  pp.  91-166.) 
COMMONS,  J.  R.     Industrial  Goodwill.     N.   Y.,   McGraw-Hill  Book  Co., 

1919. 
GARTON   FOUNDATION.     Memorandum  on  the   Industrial  Situation  After 

the    War.     Philadelphia,    U.   S.   Shipping    Board,    Emergency    Fleet 

Corporation,  1919.     First  English  ed.,  1918. 

HOXIE,  R.  F.     Trade  Unionism  in  the  United  States.     N.  Y.,  D.  Apple- 
ton   &  Co.,  1919.     Collective  Bargaining  and  Trade  Union  Program, 

pp.  254-278.     Bibliography,  pp.  275-278. 
WEBB,   SIDNEY  and  BEATRICE.     Method  of   Collective   Bargaining.     (In 

their  Industrial  Democracy,  1914,  pp.  172-221.) 
WEBB,    SIDNEY.     Works    Manager   Today.     N.   Y.,   Longmans,  Green  & 

Co.,  1917. 


CHAPTER  XXXIII 

EMPLOYERS'  ASSOCIATIONS 

That  it  is  a  good  business  proposition  for  corporations  to  join 
employers'  associations  is  no  longer  doubted  by  the  majority  of 
managers.  It  may  be  less  clear,  however,  that  the  work  and 
character  of  those  associations  is  likely  in  one  way  or  another  to 
have  its  influence  upon  the  labor  policy  and  procedure  of  each 
constituent  corporation.  We  believe  such  an  influential  rela- 
tion exists;  and  for  that  reason  we  shall  consider  the  several 
types  of  employers'  bodies  and  their  functions,  in  relation  to  the 
work  of  personnel  administration. 

This  demonstrable  relationship  is  of  two  distinct  types — posi- 
tive and  negative,  constructive  and  repressive.  And  it  is  there- 
fore essential  for  the  personnel  manager  in  his  efforts  to  maintain 
right  labor  relations,  to  estimate  the  influences  of  the  affiliations 
of  a  corporation  upon  its  own  labor  policy.  These  affiliations 
may  be  employers'  organizations  of  four  types :  A  local,  general 
body  of  employers;  a  local  group  in  one  trade;  the  national 
trade  association;  and  other  miscellaneous  national  industrial 
associations. 

Local  Associations. — The  local  chamber  of  commerce  is  usually 
in  fact  a  preponderantly  employer  group.  Its  influence  in  the 
local  community  is  often  great,  but  its  direct  connection  with  the 
operating  problems  of  industry  is  not  usually  close  unless  it  has  an 
industrial  relations  committee  which  seeks  to  prevent  strikes  by 
mediating  or  arbitrating  labor  disputes.  In  some  cities,  how- 
ever, there  are  special  committees  in  the  chamber  which  are 
active  in  following  labor  legislation  and  in  improving  the  adminis- 
trative ability  of  the  executive  staffs  of  its  member  corporations 
by  instituting  special  conferences,  courses  or  institutes  in  some 
major  branch  of  management. 

The  local  "employers'  association,"  however,  since  it  is  com- 
posed primarily  of  manufacturers,  is  in  a  position  to  have  an 
influence  in  the  practices  of  each  individual  plant.  While  it  is 
impossible  to  generalize  with  accuracy,  it  has  been  true  in  the  past 

481 


482  PERSONNEL  ADMINISTRATION 

that  these  associations  have  been  largely  defensive  and  repressive 
bodies.  Their  policy  has  too  often  been  one  of  "anti-unionism," 
"anti-union  shop,"  anti-picketing,"  "anti-boycott."  And  so 
zealous  has  been  their  desire  to  carry  out  these  purposes  that  in 
some  cases  they  have  under  one  guise  or  another  distributed 
information  to  their  members  as  to  "undesirables,"  "agitators" 
and  "organizers"  who  are  discharged  from  the  plants  of  any  of 
their  members.  To  make  this  "  weeding-out "  policy  truly 
effective,  they  have  sometimes  encouraged  their  members  to 
employ  detectives  to  identify  the  "uneasy  element,"  and  help 
to  eliminate  it. 

Clearly  this  is  a  negative  program.  And  from  a  constructive 
point  of  view  the  effects  of  it  have  been  far  from  promising.  Any 
rigorously  repressive  policy  such  as  this,  is  soon  known  to  the 
workers  of  the  locality.  It  becomes  an  invitation  to  self-respect- 
ing workers  to  stay  away,  or  else  to  come  in  with  the  deliberate 
intention  of  organizing  their  fellow  employees  and  making  vocal 
their  grievances.  Both  of  these  things  have  happened  in  the 
past;  but  up  until  the  last  few  years  the  stronger  tendency  has 
been  for  the  submissive,  timid  and  docile  workers  to  remain  in 
the  majority  by  a  natural  process  of  sifting.  There  are  localities 
in  this  country  where  the  deep  impress  of  this  "anti"  policy 
has  so  reflected  itself  in  the  employment  office  of  every  plant,  that 
it  has  been  a  distinctly  handicapping  influence.  The  handicap 
expressed  itself  in  the  type  of  workers  who  applied  for  work,  in 
their  working  spirit,  in  the  attitude  of  executives  and  foremen,  in 
the  whole  labor  policy  of  the  plant. 

This  is  the  more  regrettable  because  the  positive  measures 
which  might  be  taken  are  so  many.  The  local  employers'  as- 
sociation can  in  many  places  help  greatly  to  consolidate  the  labor 
market;  yet  in  times  past  the  tendency  has  been  for  employers' 
associations  to  confine  employment  work  to  the  placing  of  avowedly 
non-union  workers  willing  to  go  to  aggressively  non-union  shops. 

Much  could  also  be  done  cooperatively  by  local  employers  on 
such  matters  as  local  housing  and  transportation.  Much  can  be 
done  in  the  cooperative  use  of  industrial  doctors,  nurses  and 
special  experts  to  direct  training  courses;  in  the  teaching  of 
English;  in  the  study  of  the  local  cost  of  living;  and  in  the  reduc- 
tion of  local  living  costs  such  as  rents. 

Nearly  all  of  these  matters  have  been  thus  cooperatively 
handled  in  one  place  or  another.  It  only  remains  for  their  use 


EMPLOYERS'  ASSOCIATIONS  483 

to  become  general,  and  take  the  place  of  those  furtive  activities 
which  foster  animosity  and  fan  the  flame  of  class  agitation. 

But  if  the  local  association  proves  to  be  persistently  unwilling 
to  act  in  these  cooperative  directions,  the  progressive  employer's 
policy  may  have  to  be  one  of  independent  action.  He  should, 
of  course,  do  all  in  his  power  to  effect  changes  in  the  association's 
policy  by  "boring  from  within";  but  beyond  a  certain  point  of 
tolerating  a  policy  of  which  he  does  not  approve,  he  is  clearly 
justified  in  resigning  and  perhaps  is  even  morally  bound  to. 
He  should  then  let  his  position  be  distinctly  known  to  his  workers; 
and  in  this  way  avoid  the  unfavorable  working-class  reputation 
which  so  usually  attaches  to  the  plants  of  members  of  employers' 
associations  which  are  actively  repressive  in  policy  and  practice. 

The  Local  Trade  Association. — There  are  a  number  of  useful 
purposes  which  a  local  group  composed  of  the  employers  in  one 
industry  or  trade  can  serve,  which  by  their  nature  general  em- 
ployers' associations  cannot  fulfill .  We  shall  here  refer  to  such 
bodies  as  local  trade  associations.  In  the  first  place  they  can 
form  the  logical  group  with  which  local  employees  in  the  industry 
can  deal  on  matters  affecting  both  parties  locally.  Local  hours 
and  wage  rates  can  be  kept  uniform;  working  conditions  main- 
tained at  a  reasonable  minimum;  a  common  reserve  of  trained 
workers  drawn  upon,  and  irregularity  of  work  be  thus  reduced. 
There  are  in  the  printing,  textile,  boot  and  shoe,  building,  cloth- 
ing and  cigar-making  trades,  for  example,  an  increasing  number 
of  local,  city  or  district  collective  bargains  which  help  to  stabilize 
conditions,  level-up  labor  standards  and  reduce  interruptions 
of  work  due  to  strike  and  lockout. 

Moreover,  in  cities  where  there  is  a  large  group  of  employers 
manufacturing  one  product,  the  additional  possibilities  of  fur- 
ther cooperation  are  almost  limitless.  The  trade  association 
can,  for  example,  join  with  the  community  to  improve  the 
quality  of  local  education  and  relate  it  in  useful  and  interesting 
ways  to  the  local  industry;  and  to  conduct  classes  for  foremen  and 
ambitious  workers.  It  can  develop  a  common  technical  library 
in  the  local  public  library  and  local  exhibits  of  processes  and 
products.  And  it  can  help  in  the  cooperative  purchase  of  sup- 
plies, maintaining  of  warehouses,  development  of  power  plants, 
use  of  terminal  and  transportation  facilities,  etc. 

Some  associations  are  even  hiring  production  experts,  cost 
keeping  experts  and  personnel  counselors,  to  familiarize  their 


484  PERSONNEL  ADMINISTRATION 

members  with  the  latest  procedure  in  these  fields,  to  help  them 
install  modern  methods,  and  to  collect  production  and  personnel 
records  which  are  of  comparable  value  throughout  the  locality 
and  throughout  the  industry. 

Such  a  constructive  policy  requires  a  little  leadership  and 
imagination.  But  its  relation  to  the  spirit  and  method  of  the 
personnel  work  of  each  of  the  cooperating  plants  is  close;  and 
its  results  are  almost  inevitably  wholesome.  But  perhaps  the 
most  useful  service  rendered  by  an  active  and  wisely  led  local 
trade  association  is  its  demonstration  to  each  employer  that  there 
are  many  problems  vital  to  the  right  conduct  of  his  plant  which 
can  be  solved  only  as  they  are  dealt  with  by  the  common  action 
of  the  local  group.  Indeed,  his  trade  association  activities  should 
show  him  that  beyond  the  local  group  of  manufacturers  in  the 
one  industry,  there  are  also  other  similar  groups  in  the  same 
industry  in  other  parts  of  the  country,  to  whom  he  is  bound 
by  ties  that  become  more  visible  as  the  science  of  management 
is  understood  in  all  its  subtleties,  and  is  projected  eventually  into 
a  national  and  then  an  international  dimension. 

National  Trade  Associations.1 — It  is  only  possible  here  to  list 
and  touch  upon  some  of  the  functions  of  national  trade  associa- 
tions which  obviously  relate  to  labor  questions.  There  is  not  as 
yet  any  extensive  personnel  work  in  the  offices  of  most  of  the  na- 
tional bodies;  but  there  are  vital  points  at  which  their  activities 
might  contribute  to  the  adequate  handling  of  employment 
problems  by  the  individual  employer.  They  can  collect  com- 
parative wage  data,  cost  of  living  figures,  unit  labor  costs, 
labor  turnover  figures,  accident  and  sickness  records  and  the 
like. 

All  the  national  trade  associations  have  annual  conventions 
ot  several  days'  duration,  and  the  educational  value  of  these 
gatherings  is  increasingly  appreciated.  At  certain  sessions  it  is 
customary  in  some  associations  to  divide  the  convention  into 
sectional  meetings  at  which  different  technical  problems  are 
discussed  by  experts.  New  ideas  in  personnel  management  have 
spread  far  faster  than  would  have  been  otherwise  possible, 
because  of  the  opportunity  thus  afforded  to  leaders  in  this  field 

1  Examples  of  bodies  of  this  type  are  the  National  Cotton  Manufacturers' 
Association,  National  Metal  Trades'  Association,  National  Founders' 
Association,  American  Iron  and  Steel  Institute,  The  Tanners'  Council  of 
America,  etc. 


EMPLOYERS'  ASSOCIATIONS  485 

to  meet  large  groups  of  owners  and  managers  face  to  face  in 
conference;  and  because  employers  have  been  willing  and  eager 
to  leave  their  own  shops  to  discuss  problems  and  new  methods 
in  terms  of  their  widest  possible  application. 

The  proceedings  of  these  conventions  are  printed  and  useful 
ideas  thus  reach  a  wide  audience  in  each  industry.  This  edu- 
cational work  is  further  supplemented  in  some  cases  by  the 
distribution  of  occasional  trade  bulletins,  reprints  of  pamphlets 
and  the  preparation  of  informational  material  for  trade  papers. 

The  fostering  of  trade  research  is  a  useful  function  of  the 
national  trade  group.  Nor  should  the  research  be  confined  to 
problems  of  process.  Ideally,  it  should  be  undertaken  in  all 
departments  of  staff  management.  If,  for  example,  there  are 
processes  known  to  be  unduly  arduous  or  harmful  to  the  workers, 
which  could  be  improved  through  the  use  of  labor-saving  ma- 
chinery, research  for  harmless  and  easy  methods  should  be  in- 
stituted. It  will  be  readily  seen  that  the  work  of  job  analysis 
in  any  one  plant  will  tend  to  uncover  a  number  of  problems 
urgently  calling  for  further  study,  but  which  are  common  to  the 
entire  industry  and  should  be  studied  once  and  for  all  by  the 
industry  in  order  that  when  solved  the  entire  industry  may  bene- 
fit by  the  improvements.  In  research  work  of  this  sort,  moreover, 
the  cooperation  of  governmental  and  employee  bodies  should 
be  sought. 

The  fostering  of  cooperative  purchasing  of  raw  materials  is  usu- 
ally considered  a  distinctly  "business"  function;  but  with  the 
organization  of  markets  for  raw  materials  on  a  world  scale,  an 
industry  in  any  one  nation  that  does  not  buy  economically  may 
be  at  such  a  definite  disadvantage  that  the  ill  effects  of  this  upon 
the  industry's  prosperity  will  immediately  affect  the  workers. 

In  the  same  way,  the  necessity,  especially  for  purposes  of 
foreign  sale,  of  a  nationally  organized  agency,  interested  in  the 
marketing  problem,  is  becoming  widely  recognized.  And,  while 
the  trade  association  does  not  usually  become  a  selling  agency, 
its  advice  and  leadership  in  unifying  selling  agencies,  in  reaching 
foreign  markets,  in  discovering  the  peculiar  conditions  of  demand 
in  any  country,  or  its  special  problems  of  shipment  or  finance, 
may  be  of  great  value. 

The  possibilities  and  economies  of  standardization  of  styles, 
parts,  designs,  grades  and  names  of  materials  and  products  are 
more  fully  recognized  as  a  result  of  war  experience  than  ever 


486  PERSONNEL  ADMINISTRATION 

before.  While  there  are  wise  limits  to  such  standardization  as 
a  matter  of  industrial  policy  in  peace  times,  it  is  still  true  that 
a  strong  trade  association  is  essential  to  efforts  in  the  direction 
of  that  legitimate,  reasonable  and  a  highly  economical  amount 
of  standardizing  which  is  desirable.  Policies  of  any  sort  simply 
cannot  get  momentum  throughout  an  industry  if  there  is  no 
organized  and  organizing  agent  to  keep  eternally  at  work. 

Trade  associations,  as  was  shown  during  the  war,  can  also 
undertake  one  task  which  is  fundamentally  related  to  regulari- 
zation  of  work.  They  can  make  and  keep  current  an  inventory 
of  the  producing  capacity  of  the  entire  industry.  As  already 
pointed  out,  a  first  step  toward  "organizing  the  demand"  for 
an  industry's  product  is  to  know  the  industry's  potential  produc- 
ing power — because  sooner  or  later  there  must  be  some  correla- 
tion of  that  producing  power  with  known  needs.  In  the  absence 
of  correlation,  production  tends  to  go  off  at  a  tangent  from  demand 
in  a  way  that  invites  market  disorganization  and  depression. 

Organized  contact  with  governmental  bodies  on  the  com- 
mercial, legal,  mechanical  and  labor  aspects  of  the  industry's 
problems  is  another  necessary  service.  The  federal  government 
is  greatly  in  need  of  some  one  representative  group  to  deal  with 
in  every  industry,  whenever  administrative  or  legislative  prob- 
lems affecting  it  arise.  Issues  which  relate  to  tariffs,  railroad 
rates,  pending  legislation  in  sundry  fields — all  call  for  testimony 
from  those  in  each  industry  who  really  represent  it. 

When  the  issue  relates  to  the  labor  problem,  there  is  a  peculiar 
service  of  representation  to  be  rendered  by  the  association. 
The  unifying  of  labor  policies  and  practices  is  an  increasingly 
necessary  condition  of  an  industry's  success.  Take,  for  example, 
the  question  of  uniform  cost  systems.  There  are  still  plenty 
of  plants  which  offer  a  price  on  a  contract  when  they  have  only 
the  most  approximate  sort  of  knowledge  of  the  cost,  and  which, 
when  producing,  are  likely  to  find  that  their  price  does  not  allow 
them  to  break  even.  In  order  to  keep  solvent,  such  firms 
resort  to  the  obvious  economies.  They  keep  poorly  equipped 
plants,  pay  low  wages,  offer  generally  low  labor  standards  and 
constitute  a  high  proportion  of  the  cases  of  bankruptcy. 

The  plant  which  knows  its  costs  and  makes  its  bid  in  relation 
to  them  is  at  a  conspicuous,  if  temporary,  disadvantage  in  com- 
peting under  such  conditions.  The  inducement  to  maintain 
high  labor  standards  suffers  a  temporary  set-back.  The  ignorant 


EMPLOYERS'  ASSOCIATIONS  487 

and  unscientific  management  has  superficially  won  out  against 
the  better  organized  plant.  The  installation  of  a  uniform  cost 
keeping  system  throughout  an  industry  is  therefore  one  of  the  first 
conditons  of  assuring  every  firm 's  ability  to  pay  decent  wages,  work 
reasonable  hours  and  compete  at  a  level  where  the  exploitation  of 
the  workers  is  not  the  conspicuous  attendant  condition.  Until 
every  plant  is  bidding  on  a  basis  of  price  offerings  known  to  cover 
the  legitimate  costs,  an  industry's  progress  is  handicapped,  and 
the  most  egregious  exploiters  set  the  pace. 

In  some  industries  the  policy  of  uniform  cost  keeping  is  carried 
a  step  further  by  the  device  of  the  "open  price,"1  under  which  all 
firms  agree  to  record  at  once  with  the  association  the  price  which 
they  are  charging  for  all  orders  closed.  These  prices  are  then 
assembled  in  a  daily  or  weekly  price  list  which  goes  to  all 
members;  and  any  management  which  finds  that  its  prices  are 
noticeably  high  can  then  proceed  to  study  out  the  causes  of  its 
excessive  costs. 

Another  successful  method  of  eliminating  that  "unfair  com- 
petition" which  has  in  times  past  been  a  demoralizing  influence 
upon  the  workers  within  the  factory,  is  to  have  uniform  standards 
of  purity  or  quality,  uniform  grading  methods,  uniform  termi- 
nology. The  worker  has  always  been  more  or  less  a  party — 
or  at  least  a  silent  witness — to  employers'  questionable  methods 
of  labeling,  grading,  and  manufacture.  But  once  a  whole 
industry  has  agreed  upon  a  certain  level  of  manufacturing 
standards,  this  offense  against  common  honesty  is  greatly 
reduced. 

A  special  aspect  of  personnel  activity  on  which  there  has 
already  been  interesting  experimentation  on  an  industry-wide 
scale,  is  in  the  field  of  apprentice  training.  In  at  least  one 
industry — the  printing  trade — a  formal  apprentice  training  is 
instituted  with  the  approval  and  to  a  certain  extent  under  the 
joint  direction  of  the  national  organizations  of  employers  and 
workers.  There  is  a  training  director  for  the  entire  industry; 
courses  of  study  have  been  worked  out;  scholarships  are  provided. 
This  is  a  good  example  of  the  benefits  to  be  derived  from  develop- 
ing the  administration  of  one  of  the  fundamental  features  of 
personnel  administration  for  the  use  of  an  entire  industry. 

The  unification  of  labor  policies  reaches  its  logical  culmination 

1  For  full  treatment  of  this  subject  see  EDDY,  A,  J.,  The  New  Com- 
petition. 


488  PERSONNEL  ADMINISTRATION 

in  a  national  joint  contract  with  a  national  organization  of  the 
workers.  The  several  forms  and  methods  of  national  joint 
industrial  organization  we  shall  presently  discuss.  But  long 
before  this  point  of  joint  negotiation  is  reached  there  are  many 
lines  of  personnel  work  which  the  national  trade  association 
can  follow.  All  of  them,  however,  if  they  are  to  be  pursued  with 
any  thoroughness  and  persistence,  require  for  their  execution  a 
permanent  secretary  of  the  association,  working  wholly  in  the 
personnel  field.  Such  an  official  can  then  become  in  effect  a 
labor  consultant  for  the  industry  and  for  many  of  the  individual 
members.  He  can  conduct  an  information  bureau  as  to  new 
experiments  in  the  employment  field;  he  can  help  factories  find 
suitable  executives;  he  can  undertake  personnel  research;  he 
can  know  in  detail  the  labor  situation  of  his  industry;  he  can  keep 
current  records  of  its  wage  scales,  hours,  etc.  In  short,  he  can 
be  to  the  industry  what  the  personnel  manager  is  to  the  factory — 
its  staff  expert  and  advisor  on  personnel  problems.  Where 
conditions  are  ripe  he  can,  finally,  be  the  means  of  bringing 
representative  groups  from  the  employers  and  the  employees 
of  the  industry  together  for  joint  consideration  of  their  common 
problems. 

The  case  for  the  national  trade  association  needs  no  elaborate 
arguing.  But  it  is  altogether  in  place  to  point  out  the  statesman's 
role  which  such  bodies  can  play  in  industrial  relations  work,  if 
only  the  possibilities  are  appreciated. 

We  recognize,  of  course,  that  the  employers  of  any  industry 
when  once  organized  may  adopt  an  illiberal  attitude  toward 
personnel  administration.  They  may  maintain  a  defensive 
attitude  toward  production  exactly  as  the  labor  unions  have 
tended  to.  They  may  prefer  to  dwell  upon  conflicts  of  interest 
rather  than  upon  points  of  common  interest  with  the  employees 
of  the  industry.  We  see  less  likelihood  of  this  happening  in 
the  future  than  in  the  past,  however,  in  the  light  of  the  present 
wide  interest  in  positive  and  preventive  measures.  But  a 
conservative  organization  is  probably  better  than  none,  for  it 
offers  the  foundation  for  future  building.  And  our  analysis 
will  have  been  singularly  unsuccessful  if  it  is  now  not  clear  that 
the  maximum  degree  of  nation-wide  organization  on  the  part  of 
both  employers  and  workers  is  indispensable  to  a  scientific  and 
sound  industrial  future.  Until  the  point  is  reached  where  the 
employers  of  an  industry  are  at  least  75  per  cent,  organized 


EMPLOYERS'  ASSOCIATIONS  489 

throughout  the  nation,1  and  the  employees  are  organized  to  a 
like  degree,  the  industry  is  not  ripe  for  those  developments  of 
industrial  government  which  alone  will  bring  a  reasonable 
stability  and  maximum  productivity  to  the  industry. 

Speaking  of  the  potential  significance  of  strong  organizations 
of  workers  and  employers  the  now  famous  Garton  Foundation 
Memorandum  says: 

"  Yet  the  possibilities  of  combined  action  which  lie  in  these  two  great 
groups  of  highly  organized  and  powerful  bodies  might  transform  the 
whole  face  of  industrial  life.  Their  united  knowledge  of  both  sides  of 
the  industrial  process  should  enable  them  to  throw  light  on  every  phase 
of  its  successive  developments.  Their  united  strength  would  render 
them,  in  combination,  practically  irresistible.  But  to  secure  the  realiza- 
tion of  these  possibilities  the  cooperation  between  the  two  groups  must 
be  continuous  and  constructive,  and  must  be  based  upon  a  recognition 
of  the  common  interests  of  employers  and  employed,  both  as  parties 
to  industry  and  members  of  the  community.  Employers  must  realize 
that  both  their  own  interests  and  the  obligations  of  citizenship  impose 
upon  them  the  necessity  of  a  sympathetic  understanding  of  the  lives 
and  standpoint  of  those  with  whom  they  work  and  a  willingness  to  co- 
operate, without  dictation  or  patronage,  in  every  endeavour  to  improve 
their  material  or  social  conditions.  Labor  must  realise  its  direct  in- 
terest in  the  improvement  of  industrial  processes,  the  organization  of 
industry,  the  standard  and  quantity  of  production,  and  the  elimination 
of  waste  in  material  or  effort.  Both  the  Employers'  Association  and 
Trade  Unions  must  learn  to  regard  themselves  as  joint  trustees  of  one 
of  the  most  important  elements  of  the  national  life."2 

Other  National  Associations. — The  general  national  associa- 
tions of  employers  aim  largely  to  educate  employers  and  public 
opinion.  There  is  in  this  group  the  National  Manufacturers' 
Association  which  interests  itself  in  broad  questions  of  industrial 
policy  in  relation  to  the  government,  the  workers  and  the 
consumer. 

There  is  the  League  for  Industrial  Rights  which  is  devoted  to 
a  consideration  of  the  legal  phases  of  the  relations  of  employers 
and  employed. 

The  United  States  Chamber  of  Commerce,  especially  through 

1  This  should  mean  75%  of  the  total  volume  of  production  as  well  as  75% 
of  the  total  number  of  employers. 

2  Garton    Foundation    Memorandum  on  The   Industrial  Situation  after 
the    War,    reprinted    by  U.   S.   Shipping    Board,    Emergency   Fleet  Cor- 
poration. 


490  PERSONNEL  ADMINISTRATION 

its  industrial  relations  committee,  attempts  to  crystallize  em- 
ployers' opinions  on  broad  industrial  policies  and  on  specific 
matters  of  pending  or  proposed  federal  legislation. 

The  National  Industrial  Conference  Board  is  a  research  body 
composed  really  as  an  association  of  trade  associations,  for  carry- 
ing on  elaborate  studies  of  pertinent  issues  in  the  whole  personnel 
field.  And  there  is  the  National  Civic  Federation,  not  strictly 
an  employers'  association,  but  one  in  which  they  are  largely 
influential.  Its  purpose  is  to  provide  a  common  meeting  ground 
upon  which  the  representatives  of  "capital  and  labor"  of  the 
nation  can  come  to  a  better  understanding  of  the  labor  problem 
and  of  each  other. 

Conclusion. — Employers'  associations  offer  large  opportunities 
for  constructive  service  in  the  next  ten  years — especially  those 
trade  organizations  in  which  employers  are  brought  together  by 
their  common  interest  in  the  same  industry.  The  day  has 
obviously  passed  when  such  groups  by  repressive  measures  can 
gain  advantages  which  are  either  temporary  or  permanent.  The 
cause  of  truly  scientific  management  has  already  been  too  greatly 
prejudiced  by  the  tactics  of  those  few  employers  in  such  associa- 
tions who  are  more  interested  in  "fighting  things  to  a  finish," 
than  in  building  up  an  organization  for  the  management  of  per- 
sonnel which  will  really  cope  with  that  elaborate  problem. 

The  strategic  move  of  associated  employers  in  the  next  few 
years  is  rather  in  the  direction  of  getting  all  the  positive  gains 
possible  out  of  cooperative  action.  Happily,  all  the  external 
influences  are  combining  to  make  trade  associations  not  only 
useful  but  indispensable.  For  in  strong  employers'  associations, 
ably  led  and  mindful  of  the  business  value  of  a  liberal  policy, 
lies  the  hope  of  amicable  and  economical  transition  to  a  basis 
of  conference  with  workers  who  are  likewise  widely  organized. 
Industry  is,  if  it  but  knew  it,  seeking  a  basis  for  the  joint  effort 
of  managers  and  manual  workers  who  shall  organize  each  in- 
dustry on  a  scientific  footing  and  with  a  social  purpose. 

Selected  References 

BKNN,  E.  J.  P.  Trade  of  To-morrow.  N.  Y.,  E.  P.  Dutton  A  Co.,  1918. 
COHEN,  J.  H.  Law  and  Order  in  Industry;  Five  Years'  Experience. 

N.  Y.,  Macmillan  Co.,  1916. 
Criticisms  of   Employers'    Associations.     (In   Survey,   v.  33,  pp.  287-288, 

Dec.  12,  1914.) 


EMPLOYERS'  ASSOCIATIONS  491 

EDDY,  A.  J.  New  Competition;  An  Examination  of  the  Conditions 
Underlying  the  Radical  Change  that  is  Taking  Place  in  the  Commercial 
and  Industrial  World — The  Change  from  a  Competitive  to  a  Co- 
operative Basis.  Chicago,  A.  C.  McClurg  &  Co.,  1917. 

Employers'  Organization  Stiffens  Unions.  (In  Survey,  v.  37,  pp.  203-204, 
Nov.  25,  1916.) 

HOXIE,  R.  F.  Employers'  Associations.  (In  his  Trade  Unionism  in  the 
United  States.  1917.  pp.  188-210.)  Bibliography,  pp.  206-210. 

HURLEY,  E.  N.  Awakening  of  Business.  N.  Y.,  Doubleday,  Page  & 
Co.,  1916. 

REDFIELD,  W.  C.     New  Industrial  Day.     N.  Y.,  Century  Co.,  1913. 

U.  S.  BUREAU  OF  FOREIGN  AND  DOMESTIC  COMMERCE.  Commercial 
Organizations  in  the  United  Kingdom  with  a  Description  of  British 
Manufacturers'  and  Employers'  Organizations.  Washington,  Govt. 
Printing  Office,  1915. 

WRIGHT,  P.  G.  Contest  in  Congress  Between  Organized  Labor  and  Organ- 
ized Business.  (In  Quarterly  Journal  Economics,  v.  29,  pp.  235-261, 
Feb.,  1915.) 


CHAPTER  XXXIV 
NATIONAL  INDUSTRIAL  COUNCILS 

A  national  industrial  council,  as  the  term  is  used  here,  means 
a  joint  standing  body  equally  representative  of  the  nationally 
organized  employers  and  workers  of  an  industry.  The  term  is  an 
English  one  and  was  applied  originally  to  bodies  so  constituted 
in  a  number  of  English  industries.  We  have  throughout  this 
volume  studiously  avoided  the  use  of  illustrations  of  industrial 
procedure  from  other  countries,  realizing  that  conditions  on  the 
two  continents  are  never  completely  analogous  and  that  any 
proposal  must  always  be  modified  to  suit  local  needs.  But  in 
this  instance  we  believe  a  brief  exposition  of  the  English  move- 
ment with  the  reasons  for  it  will  be  in  point,  since  we  find  those 
reasons  so  largely  duplicated  in  this  country,  and  since  also  the 
beginnings  of  an  almost  identical  movement  are  already  dis- 
cernible here.  American  managers  can,  we  are  therefore  con- 
fident, learn  much  from  the  success  and  limitations  of  the  English 
development. 

The  English  Councils. — As  early  in  the  war  as  March,  1917, 
a  sub-committee  of  the  Reconstruction  Committee,  later  the 
Reconstruction  Ministry,  presented  to  the  War  Cabinet  its  First 
(Interim)  Report  on  Joint  Standing  Industrial  Councils.  This 
report  recommended: 

"The  establishment  for  each  industry  of  an  organization,  represen- 
tative of  employers  and  work  people,  to  have  as  its  object  the  regular 
consideration  of  matters  affecting  the  progress  and  well-being  of  the 
trade  from  the  point  of  view  of  all  those  engaged  in  it,  so  far  as  this  is 
consistent  with  the  general  interest  of  the  community." 

"With  a  view,"  the  report  continues,  "to  providing  means  for  carry- 
ing out  the  policy  outlined  above,  we  recommend  that  His  Majesty's 
Government  should  propose  without  delay  to  the  various  associations 
of  employers  and  employed  the  formation  of  Joint  Standing  Industrial 
Councils  in  the  several  industries,  where  they  do  not  already  exist, 
composed  of  representatives  of  employers  and  employed,  regard  being 
paid  to  the  various  sections  of  the  industry  and  the  various  classes  of 
labor  engaged." 

"It  is  not  enough  to  secure  cooperation  at  the  center  between  the 
national  organizations;  it  is  equally  necessary  to  enlist  the  activity  and 

492 


NATIONAL  INDUSTRIAL  COUNCILS  493 

support  of  employers  and  employed  in  the  districts  and  in  individual 
establishments.  The  National  Industrial  Council  should  not  be  re- 
garded as  complete  in  itself;  what  is  needed  is  a  triple  organization — in 
the  workshops,  the  districts  and  nationally." 

And  in  order  to  get  the  proposed  functions  of  these  councils 
clearly  before  us  we  quote  also  the  following: 

"Among  the  questions  with  which  it  is  suggested  that  the  National 
Councils  should  deal  or  allocate  to  District  Councils  or  Works  Commit- 
tees the  following  may  be  selected  for  special  mention : 

(i)  The  better  utilization  of  the  practical  knowledge  and  experience 
of  the  workpeople. 

(ii)  Means  for  securing  to  the  workpeople  a  greater  share  in  and  re- 
sponsibility for  the  determination  and  observation  of  the  conditions 
under  which  their  work  is  carried  on. 

(Hi)  The  settlement  of  the  general  principles  governing  the  conditions 
of  employment,  including  the  methods  of  fixing,  paying,  and  readjust- 
ing wages,  having  regard  to  the  need  for  securing  to  the  workpeople  a 
share  in  the  increased  prosperity  of  the  industry. 

(iv)  The  establishment  of  regular  methods  of  negotiating  for  issues 
arising  between  employers  and  workpeople,  with  a  view  both  to  the 
prevention  of  differences,  and  to  their  better  adjustment  when  they 
appear. 

(v)  Means  of  ensuring  to  the  workpeople  the  greatest  possible  security 
of  earnings  and  employment,  without  undue  restriction  upon  change  of 
occupation  or  employer. 

(vi)  Methods  of  fixing  and  adjusting  earnings,  piecework  prices,  etc., 
and  of  dealing  with  the  many  difficulties  which  arise  with  regard  to 
the  method  and  amount  of  payment  apart  from  the  fixing  of  general 
standard  rates,  which  are  already  covered  by  paragraph  Hi. 

(vii)  Technical  education  and  training. 

(viii)  Industrial  research  and  the  full  utilization  of  its  results. 

(ix)  The  provision  of  facilities  for  the  full  consideration  and  utiliza- 
tion of  inventions  and  improvement  designed  by  workpeople,  and  for 
the  adequate  safeguarding  of  the  rights  of  the  designers  of  such  improve- 
ments. 

(x)  Improvements  of  processes,  machinery  and  organization  and 
appropriate  questions  relating  to  management  and  the  examination  of 
industrial  experiments,  with  special  reference  to  cooperation  in  carry- 
ing new  ideas  into  effect  and  full  consideration  of  the  workpeople's 
point  of  view  in  relation  to  them. 

(xi)  Proposed  legislation  affecting  the  industry."1 

1  For  all  the  earlier  documents  in  connection  with  the  Council  movement, 
see  The  Industrial  Council  Plan  in  Great  Britain,  compiled  by  the 
Bureau  of  Industrial  Research,  New  York. 


494  PERSONNEL  ADMINISTRATION 

At  the  time  this  report  was  submitted,  industrial  unrest  and 
tension  in  England  were  acute.  And  it  seems  to  have  been  the 
Government's  conclusion  that  favorable  action  on  the  report 
would  relieve  the  tension.  The  Ministry  of  Labor  was  therefore 
empowered  to  proceed  with  the  calling  together  of  such  councils 
in  those  industries  where  both  sides  were  strongly  enough  organ- 
ized to  provide  a  substantial  nucleus  to  work  with.  Beginning 
gradually,  the  organization  of  standing  councils  has  gone  on  until 
now  it  has  spread  to  over  fifty  industries  in  which  are  included 
over  three  million  workers.  And  the  extension  of  the  movement 
is  by  no  means  at  an  end.  England  has,  indeed,  proceeded  to 
apply  an  idea  which  has  real  vitality  and  potentially  great  sig- 
nificance in  the  structure  of  industrial  government. 

Reasons  for  the  Movement. — Clearly,  the  idea  of  a  joint  national 
industrial  council  did  not  emanate  fully  developed  from  one  per- 
son or  group;  nor  did  it  get  its  momentum  wholly  by  virtue  of 
its  inherent  logic  or  wisdom.  There  had  been  a  play  of  minds  and 
forces  to  get  the  idea  into  practical  politics;  several  urgent 
reasons  combined  to  make  it  flourish.1  The  urgency  of  these 
reasons  lies  in  economic  conditions  which  are  not  peculiar  to 
Great  Britain. 

England  wanted,  and  still  wants  and  needs,  high  productivity. 
She  cannot  get  it  with  industrial  conflict,  ca-canny,  sabotage, 
limitation  of  output  and  strikes,  rampant  throughout  the  land. 
She  cannot  get  it  under  a  competition  which  ignores  quality, 
which  creates  high  charges  for  competitive  selling  abroad,  which 
allows  the  least  efficient  manufacturers  to  dictate  the  terms  on 
which  an  entire  industry  shall  employ  its  workers.  In  other 
words,  the  demand  for  large  output  and  low  unit  costs  creates 
the  first  reason  for  agreeing  upon  a  "get  together"  policy. 

The  councils  promise  to  create  under  them  a  peaceful  con- 
ference method  of  adjusting  differences.  This  is  more  economical 
than  appeals  to  force;  it  is  more  sensible;  if  properly  used, 
the  method  may  prove  more  satisfactory  and  more  fruitful  for 
all  parties.  The  workers,  if  they  find  that  their  share  in  control 
is  a  vital  and  increasing  share,  will  be  disposed  to  favor  negotia- 
tion instead  of  strikes. 

1  For  analysis  of  similar  prior  proposals  sec  TEAD,  ORDWAY,  British  Recon- 
struction Programs,  Political  Science  Quarterly,  May,  1918. 

Also,  WOLFE,  A.  B.,  Works  Committees  and  Joint  Industrial  Councils, 
pp.  36-40. 


NATIONAL  INDUSTRIAL  COUNCILS  495 

Again,  an  industrial  council  can  eliminate  the  worst  forms  of 
competition.  It  can  help  to  standardize  styles,  parts  and  designs 
to  a  reasonable  degree.  It  can  begin  to  create  an  opinion  which 
will  eventuate  in  the  abolition  of  private  monopoly  in  raw 
materials  and  in  the  abuse  of  patent  rights.  It  can  assure 
that  the  competition  shall  be  for  quality  of  goods,  and  not  for 
mere  cheapness  of  price  at  the  expense  of  the  human  standards 
of  the  industry.  That  is,  it  can  level  up  and  approximately 
equalize  the  conditions  and  terms  of  employment  throughout 
an  industry. 

All  of  these  reasons  for  adopting  councils  hold  also  with  almost 
equal  force  in  respect  to  American  conditions.  But  are  the 
broad  outlines  of  the  proposal  itself  suitable  to  meet  American 
needs?  Careful  analysis  of  the  details  of  the  plan  is  needed 
before  judgment  on  this  point  can  be  finally  made. 

First,  the  council  is  not  primarily  an  adjudicative  body;  nor  is 
it  formed  under  a  "collective  bargain"  terminable  at  a  specified 
date.  The  agreement  takes  the  form  of  a  permanent  instrument. 
It  is  virtually  a  constitution,  a  body  of  basic  law  governing  the 
scope  and  method  of  joint  procedure  in  an  industry.  This  should 
mean  no  loss  of  flexibility  in  determining  labor  standards;  it 
simply  means  that  demands  for  changes  in  the  terms  of  operation 
are  to  be  considered  with  a  minimum  interruption  of  work  and  a 
maximum  use  of  orderly  parliamentary  conference,  as  provided 
for  under  the  terms  of  the  basic  understanding. 

Second,  the  council  and  all  agencies  subsequently  created 
under  it  recognize  flatly  in  their  composition  the  principle  of 
equal  representation  for  the  two  parties — organized  employers 
and  organized  workers.  Far  from  there  being  any  question 
about  the  legitimacy  or  value  of  organization  on  either  side,  it 
is  seen  to  be  essential  to  any  integrated,  intelligently  conceived 
plan.  Indeed,  so  necessary  is  it  for  the  success  of  the  larger 
purposes  of  the  council  idea  that  the  representation  shall  reflect 
the  entire  industry,  that  some  form  of  enforced  membership 
in  employers'  and  workers'  organizations  was  seriously  proposed 
in  England.  The  pottery  industry,  which  was  the  first  to  as- 
semble under  the  Council  plan,  said  explicitly  that  either 

"  (a)  The  State  should  give  the  force  of  law  to  the  determinations 
of  a  joint  committee  ....  or 

"  (6)  Membership  in  Trade  Associations  and  Trade  Unions  should  be 
compulsory  by  law  on  all  eligible  for  membership." 


496  PERSONNEL  ADMINISTRATION 

This  demand  is  significant,  even  though  it  may  not  be  immedi- 
ately acted  upon  in  England  and  would  hardly  even  be  put  for- 
ward at  the  present  time  in  this  country.  But  it  shows  that  both 
sides  when  partially  organized  recognize  the  necessity  of  com- 
plete integration.  That  necessity  will  now  be  more  and  more 
widely  seen,  and  inclusive  membership  on  both  sides  will  thus 
be  virtually  enforced  by  the  pressure  of  the  economic  situation. 

Third,  as  a  necessary  attendant  of  this  full  joint  representation 
is  the  power  to  decide  upon  many  more  matters  than  the  usual 
"wages,  hours  and  conditions."  Inevitably,  as  both  sides  have 
the  capacity  and  the  power  which  a  comprehensive  industrial 
association  brings,  they  will  desire  to  confer  over  a  wide  range  of 
problems.  Specifically,  the  English  plan  as  shown  above  con- 
templates consideration  jointly  of  methods  of  conference  and 
shared  responsibility,  methods  of  settling  disputes,  training, 
research,  introduction  of  improvements,  proposed  legislation 
and  the  like.  This  widened  basis  of  negotiation  has  two  values, 
the  one  educational  for  managers  and  workers  concerning  their 
common  problems,  the  other  more  directly  practical,  since  it  is 
becoming  clear  to  the  most  reluctant  that  all  the  details  of  shop 
management  which  affect  the  workers  are  only  settled  satisfac- 
torily— are  only  settled  in  a  way  that  makes  harmonious  opera- 
tion possible — when  the  workers  are  consulted  regarding  the 
acceptance  of  those  details.  And  the  extension  of  the  conference 
method  is  hopefully  regarded  as  meaning  a  better  spirit  and  a 
more  intelligent  cooperation  in  carrying  on  the  industry's  affairs. 

Fourth,  there  is  the  value  in  the  council  plan  that  it  does  not 
desire  to  centralize  all  power  and  authority.  It  seeks  deliber- 
ately to  get  district,  local  and  shop  groups  to  undertake  responsi- 
bility for  problems  relating  primarily  to  those  smaller  groupings. 
It  invites  decentralization.  Indeed,  it  must,  if  the  support  and 
interest  of  the  individual  workers  are  to  be  permanently  secured. 
In  short,  the  principle  of  function  is  adopted,  and  each  body  is 
expected  to  assume  jurisdiction  over  those  matters  concerning 
which  it,  and  it  alone,  is  informed,  specially  interested  and 
competent  to  decide. 

It  will  be  seen  from  this  analysis  that  the  idea  has  been  care- 
fully worked  over;  and  that  the  plan  is  calculated  to  meet  the 
tests  of  practice.  Nevertheless  it  is  still  far  from  perfect  and 
careful  consideration  of  its  limitations  is  necessary.  For  it  is 
precisely  these  shortcomings  which  can  be  profitably  avoided 


NATIONAL  INDUSTRIAL  COUNCILS  497 

by  managers  in  America  who  decide  to  undertake  any  sort  of 
national  joint  conference. 

Limitations  of  the  Council  Idea. — There  is,  first,  no  recognition 
of  an  active  public  interest  in  the  deliberations  of  the  council. 
Only  two  of  the  parties  are  given  voice — the  employer  and  the 
worker.  Neither  the  direct  consumer  nor  the  general  community 
interest  is  represented.  If  the  idea  of  representation  of  divergent 
interests  is  to  be  applied,  it  should  be  consistently  applied;  and 
not  leave  the  important  consumers'  and  the  public's  regulative 
interests  ignored  and  without  voice.  If  adjustment  is  to  be 
reached  by  securing  a  balance  of  forces — by  securing  a  temporary 
equilibrium  of  groups  which  are  still  trying  to  find  a  common 
purpose  on  which  to  build — the  likelihood  of  a  stable  and  equitable 
adjustment  is  greatest  when  every  possibly  disturbing  factor, 
every  vital  interest,  is  allowed  free  expression  and  consideration. 
There  is  the  danger,  as  the  English  Fabians  point  out,  "of  ex- 
ploitation of  the  community  by  combinations,  i.e.,  of  employers 
and  workers  of  a  trust  character  whose  objects  might  include 
the  forcing  up  of  prices." 

Second,  there  is  not  any  explicit  recognition  that  standards  of 
a  "fair"  day's  work  and  a  "fair"  day's  pay  are  necessarily 
progressive  and  not  static  standards.  Needless  misunderstanding 
and  ill-will  arise  in  industry  through  the  present  failure  of  one 
side  or  the  other  to  see  that  "reasonableness,"  "just  compensa- 
tion," and  "efficient  workmanship"  are  concepts  as  relative  as 
the  term  "nearness"  when  applied  to  the  stars.  Industrial 
constitutions  will  be  in  danger  as  long  as  employers,  for  example, 
do  not  realize  that  the  workers'  demands  are  not  necessarily 
going  to  stop  at  some  fixed  point.  Their  desire  for  shorter  hours, 
higher  earnings,  better  shop  conditions,  for  more  voice  in  con- 
trolling price  and  output,  promises  to  assert  itself  for  some  time. 

And  if  in  that  situation  the  time  arrives  when  to  satisfy  the 
claims  of  the  head  and  hand  workers,  there  must  come  a  shift  in 
the  proportion  of  the  total  income  which  goes  to  capital  holders, 
it- must  be  understood  by  all  that  we  are  in  a  fluid,  transitional, 
economic  era.  Either  the  workers  of  the  head  and  hand  will 
assume  fuller  and  fuller  control  of  industry  by  the  orderly  means 
which  these  councils  provide;  or  they  will  try  to  get  it  in  some 
other  way.  And  we  do  not  get  a  sense  in  the  English  movement 
of  any  adequate  appreciation  by  those  involved  of  the  fact  that 
the  present  underlying  basis  of  relationship  between  employers 

32 


498  PERSONNEL  ADMINISTRATION 

and  workers  with  the  present  private  ownership  of  capital,  and 
the  present  direction  of  productive  energies  by  the  holders  of 
credit,  is  itself  not  necessarily  ultimate  but  may  be  on  its  way  to 
changes  not  clearly  seen  by  any  of  us.1 

In  the  third  place,  as  the  English  radicals  of  the  "left"  have 
pointed  out,  the -council  scheme  definitely  fails  to  include  the 
purchase  and  allocation  of  raw  materials  as  one  of  the  matters  for 
joint  determination.  As  an  immediate  proposition,  that  omission 
is  probably  politic  and  discreet.  But  no  one  can  watch  the 
increasing  role  which  transportation,  coal,  iron,  food,  cotton, 
wool,  copper,  hides  and  rubber — to  mention  only  some  of  the 
most  obvious  commodities- — play  in  industrial  affairs  and 
international  destinies,  without  getting  an  uncomfortable  im- 
pression that  to  consider  industrial  relations  without  considering 
where  the  raw  material  is  coming  from,  how  much  it  costs,  where 
it  is  going  and  what  use  is  to  be  made  of  it,  is  like  trying  to  solve 
an  equation  in  which  the  crucial  factors  are  unknown.  Sooner 
or  later  there  will  come  from  the  workers  an  irresistible  demand 
to  be  admitted  to  deliberations  where  decisions  affecting  raw 
materials  are  being  made.  And  with  that  slight  but  far  reaching 
addition  to  the  statement  of  joint  powers  will  come  an  accumula- 
tion of  responsibility  and  power  for  the  council  which  will  raise  it 
to  a  place  of  determining  influence  in  industry.  For  when 
jurisdiction  does  extend  to  raw  materials,  the  need  will  be  clear 
for  a  gradual  coming  together  of  councils  into  what  will  eventu- 
ally be  a  National  Industrial  Parliament. 

Finally,  there  is  the  objection  voiced  by  the  more  "radical" 
labor  union  groups  that  the  plan  is  altogether  too  temporizing; 
that  it  does  not  "go  far  enough;"  that  while  the  plan  professes 
to  provide  "means  for  securing  to  the  workpeople  a  greater  share 
in  and  responsibility  for  the  determination  and  observance  of  the 
conditions  under  which  their  work  is  carried  on,  it  did  nothing 
to  provide  for  or  definitely  suggest  such  means;"  that  even  if  it 
did  provide  such  means,  the  primary  efforts  of  the  workers  on  the 
councils  should  be  "to  press  vigorously  the  movement  to  secure 
for  labor  control  of  production  and  industry." 

Convinced  of  the  soundness  of  these  objections  three  of  the 
most  influential  unions  have  thus  far  refused  to  share  in  institut- 

1  A  conspicuous  exception  to  this  statement  is  to  be  noted  in  the  case 
of  the  building  trades.  See  The  Industrial  Council  fur  the  Building  In- 
dustry, by  the  GarUm  Foundation,  London,  1919. 


NATIONAL  INDUSTRIAL  COUNCILS  499 

ing  councils  in  their  industries — railroading,  mining  and  the 
engineering  or  metal  trades.  Both  the  railroad  and  the  mine 
workers  contemplate  a  plan  of  government  ownership  of  the 
physical  properties  together  with  operation  by  a  directorate  on 
which  the  executive  workers,  the  manual  workers  and  the  public 
are  equally  represented.  There  would  be  little  point  in  delaying 
our  discussion  of  the  application  of  this  whole  idea  to  America, 
if  it  were  not  true  that  America  promises  to  be  presented  in  the 
next  few  years  with  an  identical  spectacle  of  certain  strong  unions 
in  the  "aristocracy  of  labor"  pressing  for  an  arrangement  of 
government  ownership  and  a  representative  management  of 
industries  like  railroading  and  mining.  Joint  control  in  councils 
of  private  owners  and  workers  is  in  these  cases  looked  upon  by 
the  workers  with  considerable  suspicion. 

The  Council  Idea  in  America. — There  is,  nevertheless,  apart 
from  these  few  industries  where  the  workers  have  come  to  see 
what  they  believe  to  be  a  wise  objective  and  have  power  enough 
to  get  it  considered,  the  germ  of  something  useful  for  America 
in  the  council  idea.  The  national  labor  unions  can  do  much  in 
effecting  local  agreements  and  universalizing  wholesome  labor 
standards.  The  national  trade  associations  can  do  much  to 
further  the  prosperity  of  their  industries.  But  there  are  many 
problems  which  the  two  groups  have  in  common  whose  solution 
is  to  mutual  advantage,  but  which  cannot  be  confidently  secured 
without  joint  action. 

There  was  under  the  admittedly  exceptional  conditions  of  the 
war,  an  unprecedented  degree  of  joint  action  between  employers 
and  employees  on  a  national  scale,  which  while  it  perhaps  proved 
nothing  for  peace  times,  was  indicative  of  possibilities.  In 
shipping,  longshore  work,  shipbuilding,  building,  harness  and 
saddlery  work,  railroading  and  coal-mining,  there  were  during 
the  war  national  collective  agreements  (or  understandings  which 
amounted  to  the  same  thing)  under  which  it  was  provided  that  there 
should  be  no  interruptions  of  work  until  after  the  action  of  some 
agreed  arbitrating  agency.  On  the  whole  these  agreements  were 
astonishingly  successful  in  accomplishing  their  primary  purpose 
of  assuring  continuous  work.  And  they  offered  at  the  same  time 
a  convincing  object  lesson  of  the  sound  logic  and  benefit  of  occa- 
sional national  conferences  between  the  leaders  of  the  employers 
and  the  workers  of  an  industry.  Happily,  it  is  likely  that  a 
method  of  negotiation  hit  upon  for  war  time  use,  will  in  several 
industries  be  continued. 


500  PERSONNEL  ADMINISTRATION 

The  council  idea,  however,  as  already  pointed  out,  does  not 
involve  initially  the  creation  of  an  adjudicative  body  so  much  as 
of  a  conference  organization.  And  proposals  for  such  conferences 
are  under  advisement  in  the  United  States  in  several  industries.1 
At  least  six  industries — the  printing  trades,  the  men's  clothing 
industry,  the  building  trades,  longshore  work,  ocean  marine  and 
harbor  marine  operation — have  either  come  together  or  are  con- 
sidering coming  together  in  regular  conference  under  definite 
written  agreements. 

In  the  printing  trades,  the  International  Conference  Council 
for  the  Printing  Industry  and  Allied  Trades  is  already  an  accom- 
plished fact.  It  is  composed  of  ten  members;  five  chosen  by  the 
several  employers'  associations  involved,  five  chosen  by  the  first 
international  unions  which  are  parties  to  it.  Meetings  are  held 
on  call;  a  "unanimous  vote  is  necessary  to  carry  any  resolution 
involving  the  establishment  of  general  principles  affecting"  any 
of  the  parties  to  the  agreement;  and  all  expenses  are  borne 
jointly. 

The  preamble  well  sets  forth  the  spirit  and  purpose  underlying 
this  cooperative  effort: 

"Only  through  joint  conferences  in  the  spirit  of  mutual  helpfulness 
between  employees  and  employers  can  the  foundation  be  laid  for  stable 
and  prosperous  conditions  within  the  printing  industry.  To  promote 
the  spirit  of  co-operation  and  to  deal  with  the  problems  of  the  industry 
in  a  way  to  insure  the  protection  of  the  interests  of  all  concerned,  the 
establishment  of  an  International  Joint  Conference  Council,  made  up  of 
representatives  of  employers  and  employees,  which  shall  be  thoroughly 
informed  as  to  conditions  and  interests  of  all  parties  in  the  industry  and 
in  a  position  to  suggest  for  ratification  regulations  which  shall  eventually 
become  the  law  of  the  industry,  is  considered  essential. 

"Compulsory  arbitration  by  law  is  deemed  impracticable  as  a  means 
of  adjusting  controversies  between  employers  and  employees.  Con- 
troversies between  employers  and  employees  can  and  should  be  ad- 
justed through  voluntary  agreements  to  refer  disputes  to  boards  on 
conciliation  and  arbitration  composed  of  representatives  of  employers 
and  employees  in  the  industry  affected.  It  is  in  this  spirit  of  arbitra- 
tion and  conciliation  that  the  organization  and  operation  of  a  Joint 
International  Conference  Council  for  the  Printing  and  Allied  Trades  is 
undertaken." 

1  A  movement  as  contemporary  as  this  cannot  of  course  be  treated  satis- 
factorily here,  so  rapidly  do  events  occur.  It  is  not  unlikely  that  by  the 
time  this  book  is  published  several  of  the  proposed  bodies  will  have  become 
a  fact,  and  similar  bodies  have  been  proposed  in  other  industries. 


NATIONAL  INDUSTRIAL  COUNCILS  501 

This  being  the  first  council  to  be  instituted  in  America  it  is 
interesting  to  state  in  full  the  scope  of  its  activities,  which  are: 

"  (a)  Outlining  of  general  trade  policies  which  will  secure  the  greatest 
degree  of  co-operation  between  employer  and  employe  and  at  the  same 
time  insure  full  protection  of  the  interests  of  the  public. 

"  (&)  Consideration,  reporting  and  advising  on  any  legislation  affect- 
ing the  trade. 

"  (c)  Studying  and  proposing  methods  for  securing  uniform  working 
hours  and  shop  practices. 

"(d)  Co-operation  with  those  departments  of  the  Goverment  exer- 
cising jurisdiction,  to  maintain  such  selling  prices  as  will  insure  a  reason- 
able remuneration  to  both  employers  and  employes. 

"(e)  Consideration  and  review  of  the  causes  of  any  disputes  which 
arise  in  the  Industry.  All  conciliation  and  arbitration  processes  covered 
in  existing  agreements  must  be  exhausted  before  appeals  are  taken  to 
the  International  Council.  Where  no  arbitration  or  trade  agreements 
are  in  effect,  appeals  may  be  taken  through  regular  recognized  channels 
to  the  International  Council. 

"  (/)  Investigation  of  the  question  of  apprenticeship  conditions;  adop- 
tion of  suitable  methods  of  selection  for  apprenticeship,  and  the  technical 
training  for  apprentices,  learners  and  journeymen  throughout  the  indus- 
try; the  improvement  of  processes,  designs  and  standards  of  workman- 
ship; to  seek  adequate  representation  on  the  control  and  management 
of  all  technical  institutes;  to  consider  and  report  upon  all  improvements 
of  processes,  machinery  and  organization,  and  appropriate  questions 
relating  to  management  and  the  examination  of  industrial  experiments, 
with  special  reference  to  co-operation  in  carrying  new  ideas  into  effect, 
and  full  consideration  of  the  employes'  point  of  view  in  relation  thereto. 
The  better  utilization  of  the  practical  knowledge  and  experience  of 
employes,  with  provision  for  facilities  for  the  full  consideration  and 
utilization  of  acceptable  inventions  and  improvements  designed  by 
employers  or  employes,  and  for  the  adequate  safeguarding  of  the  rights 
of  the  designer  of  such  improvements. 

"(g)  Determination  of  practicability  of  establishing  wage  adjust- 
ment boards  throughout  the  industry. 

"(h)  Consideration  of  any  matters  of  general  interest  to  the  trade, 
whether  industrial,  educative,  economic,  legislative  or  hygienic  may  be 
taken  up." 

The  relation  of  the  council  to  the  trade  associations,  the  unions, 
the  local  employers  and  "chapels" — organizations  of  workers 
in  one  shop — is  clearly  defined  and  wise  provision  is  made  to  keep 
the  policy  of  the  central  body  in  complete  harmony  with  the 
real  sentiment  of  the  entire  membership  of  the  industry.  The 
specific  provisions  calculated  to  do  this  follow : 


502  PERSONNEL  ADMINISTRATION 

"  (a)  Each  side  shall  submit  its  bill  of  particulars  for  action  in  the  form 
of  resolutions,  which,  after  having  been  unanimously  passed  by  the 
International  Council,  shall  be  submitted  for  ratification  to  the  con- 
stituent bodies  of  the  organizations,  parties  to  this  agreement.  Resolu- 
tions passed  by  the  International  Council  and  ratified  by  the  constituent 
bodies  of  the  organizations,  shall  be  binding  upon  all  parties  to  this 
agreement  and  shall  become  the  law  of  the  trade. 

"  (6)  For  the  purpose  of  carrying  out  the  intents  and  objects  for  which 
this  International  Council  is  formed,  local  unions,  chapels  and  shop 
committees  affiliated  with  the  respective  International  Unions,  parties 
to  this  agreement,  local  allied  printing  trades  councils  and  local  asso- 
ciations of  employers  in  the  respective  trades  dealing  with  the  unions 
under  this  agreement,  shall  be  recognized  as  proper  and  legitimate 
agencies  through  which  the  International  Council  is  to  function. 

"  (c)  It  shall  be  the  right  of  any  of  these  local  groups  of  printing  trades, 
employers  and  of  local  groups  of  employees  to  submit  to  the  Interna- 
tional Council  for  consideration  and  action  any  proposal  of  mutual 
interest,  provided,  however,  such  proposals  will  not  violate  the  legitimate 
processes  and  relations  in  existence  between  local  unions  and  re- 
spective international  unions  or  be  in  conflict  with  existing  agreements. 

"(d)  That  all  local  agreements  hereafter  entered  into  between  local 
unions  and  local  employers  shall  be  underwritten  and  guaranteed  by  the 
International  Union  having  jurisdiction  over  the  particular  trade  making 
such  local  agreement.  In  the  event  that  any  local  union  or  local  em- 
ployer violates  or  disregards  the  terms  of  this  agreement  the  action  of 
such  recalcitrant  union  or  employer  shall  be  publicly  disavowed  by  this 
International  Council  and  the  aggrieved  parties  shall  be  furnished  with 
an  official  document  to  that  effect." 

An  editorial  in  the  Typographical  Journal,  the  union  or^.-m, 
well  summarized  its  analysis  of  the  project  when  it  said,  "In 
short,  representatives  of  the  employers  and  the  employes  have 
agreed  to  a  definite  plan  for  cooperation  to  the  fullest  extent  in 
an  earnest  effort  to  place  the  commercial  printing  industry  on 
a  sound  foundation  and  to  keep  it  there."1 

It  is,  of  course,  too  early  for  any  results  of  the  work  of  such  a 
council  to  show.  But  it  is  exceedingly  significant  to  see  in  what 
a  businesslike  way  the  agreement  is  drawn;  what  a  useful  roon- 
forcement  to  the  best  in  collective  bargaining  it  supplies;  what 
a  permanent  agency  of  conference  it  offers — for  the  agreement 
is  perpetual  unless  one  or  another  party  gives  six  months'  notice 
of  withdrawal. 

1  Quoted  in  The  Survey,  June  28,  1919. 


NATIONAL  INDUSTRIAL  COUNCILS  503 

Men's  Clothing  Industry. — In  the  men's  clothing  industry 
there  is  now  instituted  a  National  Industrial  Federation  of 
Clothing  Manufacturers,  and  a  joint  national  arrangement  with 
the  Amalgamated  Clothing  Workers  of  America  has  been  con- 
templated. There  is  already  a  National  Board  of  Labor 
Managers  of  the  industry,  composed  of  the  labor  experts  of  the 
employer's  associations  in  five  of  the  big  garment  centers;  and 
the  proposal  is  for  a  council  to  be  in  the  first  instance  a  group 
which  brings  together  these  five  and  an  equal  number  of  union 
officials  under  the  title  of  the  National  Joint  Council  of  the 
Men's  and  Boys'  Clothing  Industry.  Whether  or  not  this 
council  will  be  immediately  constituted,  cannot  at  this  time  be 
stated. 

The  publication  of  the  New  York  clothing  industry  says,  how- 
ever, of  the  plan  for  the  employers'  federation:  "Only  a  year  or 
two  back,  had  such  a  federation  been  possible,  it  probably  would 
have  been  so  almost  entirely  in  an  aggressive,  or  rather  defen- 
sive sense.  But  the  new  federation — although,  of  course  pro- 
tective of  its  members'  rights — in  its  essence,  its  spirit,  its  con- 
ception and  intent,  is  for  unity  and  amity  in  all  future  labor 
arrangements,  which,  it  is  believed,  inevitably  must  standardize 
and  stabilize  the  labor  conditions,  and  so  the  future  of  the 
industry."1 

Anyone  at  all  familiar  with  the  highly  competitive  character 
of  the  garment  trades,  a  condition  accentuated  by  the  small 
amount  of  capital  required  to  set  up  as  a  manufacturer,  will 
realize  that  if  an  industry  of  this  type  can  begin  to  effect  a  national 
joint  organization,  it  is  a  possible  thing  for  any  industry.  For 
not  only  has  this  been  a  small  scale  industry  but  it  has  been 
distributed  over  a  number  of  scattered  cities  and  has  usually 
worked  on  a  narrow  margin  of  profit. 

The  Building  Trades. — In  the  building  trades  while  no  joint 
industrial  council  exists,  there  has  been  created  a  joint  body  out 
of  which  in  time  it  is  not  unlikely  that  a  genuine  council  will 
emerge.  It  is  the  National  Board  for  Jurisdictional  Awards 
in  the  Building  Industry  which  consists  of  eight  members: 

"Three  selected  by  the  Building  Trades  Department  of  the  American 
Federation  of  Labor,  and  one  each  by  the  American  Institute  of  Archi- 
tects, the  Engineering  Council,  the  Associated  General  Contractors  of 
America,  the  National  Association  of  Builders'  Exchanges,  and  the 

1  Quoted  in  The  Survey,  July  26,  1919. 


504  PERSONNEL  ADMINISTRATION 

National  Building  Trades  Employers'  Association.  Members  are  to 
serve  for  two  years.  When  a  dispute  arises  an  appeal  is  to  be  taken  to 
the  board  and  the  work  is  to  continue  with  whatever  workmen  the 
employer  may  select,  pending  a  decision.  This  may  mean  that  in  the 
individual  case  involved  the  men  eventually  shown  to  be  entitled  to 
the  work  will  lose  the  job  altogether.  The  effect  of  the  award,  however, 
will  be  to  settle  that  particular  problem,  and  eventually  a  body  of  juris- 
dictional  law  will  have  been  built  up  which  will  govern  the  assignment 
of  work.  This  process  will  be  expedited  by  the  fact  that  architects 
hereafter  will  write  into  their  specifications  such  awards  as  may  apply 
to  the  work  contemplated.  It  is  a  part  of  the  agreement  that  local 
unions  that  do  not  abide  by  the  decisions  of  the  board  shall  be  suspended 
and  the  international  union  affected  shall  proceed  to  man  the  job.  Archi- 
tects, engineers  or  employers  belonging  to  any  of  the  organizations  in- 
volved in  the  agreement  are  to  be  suspended  if  they  fail  to  observe  the 
rulings  of  the  board.  A  two-thirds  vote  will  be  required  to  render  an 
award.  If  such  a  majority  vote  is  not  secured  the  cose  is  to  be 
referred  to  an  umpire  to  be  selected  by  the  board,  or  if  it  fails  to  agree 
by  a  two-thirds  vote  upon  an  umpire,  the  secretary  of  labor  of  the 
United  States  is  to  be  called  upon  to  name  him.  The  decision  of  the 
umpire  is  to  be  final."1 

While  it  is  true  that  this  board  is  at  present  concerned  es- 
pecially with  jurisdictional  disputes  between  the  several  unions 
in  the  building  trades,  it  is  a  body  which  may  naturally  be  the 
germ  of  a  joint  conference  on  other  matters. 

The  Marine  Trades. — Conferences  in  the  marine  transport 
industries  held  in  the  middle  of  1919,  proceeded  to  a  point  where 
in  the  case  of  the  seamen  and  licensed  officers  and  the  shipowners, 
committees  have  been  at  work  on  agreements  which  may  pos- 
sibly lead  to  the  creation  of  policy  determining  andadjudicativc 
machinery.  The  Seamen's  Journal,  the  workers'  publication, 
says  of  the  proposal: 

"The  council  should  not  interfere  with  or  in  any  way  assume  to  re- 
strict the  freedom  of  action  of  seamen  or  shipowners.  Both  parties  should 
rcHerve  all  preexisting  rights  of  action,  individual  and  collective.  The 
sole  obligation  of  membership  should  consist  in  an  agreement  upon  each 
part  to  advise  with  the  council  in  any  and  all  matters  affecting  the  joint 
interests. 

"It  may  be  said  that  a  body  so  formed  would  be  powerless  to  do  more 
than  create  discussion.  This,  however,  is  in  reality  an  advantage. 
With  free  discussion  there  is  little  doubt  that  agreement  would  be 

1  The  Survey,  July  12,  1919, 


NATIONAL  INDUSTRIAL  COUNCILS  505 

reached  on  many  matters  now  in  dispute.  The  proceedings  would 
develop  a  sense  of  mutual  confidence  and  responsibility.  Partisanship 
would  give  way  to  partnership,  with  a  consequent  improvement  in  the 
attitude  of  seamen  and  shipowners  toward  each  other  and  a  better 
sense  of  joint  responsibility  for  the  conduct  of  shipping  affairs. 

"The  council  should  be  created  by  law.  To  that  extent  it  would  be 
a  public  body.  In  every  practical  sense  it  would  be  a  private  organiza- 
tion, with  membership  limited  to  the  parties  immediately  involved  in 
the  conduct  of  shipping." 

In  the  case  of  the  longshore  workers  an  agreement  was  reached 
in  September,  1919,  to  reconstitute  the  National  Adjustment  Com- 
mission which  was  active  during  the  war.  The  preamble  to  the 
agreement  states  that  "in  order  that  the  spirit  of  mutual  respon- 
sibility and  helpfulness  with  which  employers  and  employees 
engaged  in  the  loading  and  unloading  of  vessels,  and  who  co- 
operated with  the  Government  in  meeting  the  exigencies  of  a 
war  time  situation,  may  find  permanent  expression,"  a  National 
Adjustment  Commission  shall  be  established.  While  this  body 
by  no  means  exemplifies  the  essential  features  of  an  industrial 
council,  it  is  an  important  step  in  that  direction;  for  its  work 
is  to  "be  responsible  for  and  have  jurisdiction  over  industrial  re- 
lations so  far  as  they  affect  loading  and  unloading  operations  done 
under  the  control  or  on  account  of  signatory  parties  or  parties 
which  may  subsequently  join  in  this  agreement." 

There  is  also  in  the  agreement,  however,  the  following  provi- 
sion which  will  undoubtedly  be  taken  advantage  of  as  time  goes 
on: 

"For  the  consideration  of  matters  touching  the  interests  of  all  ports 
and  the  longshore  industry  in  general,  the  several  alternates  named  to 
serve  on  the  National  Adjustment  Commission  as  representatives  of  the 
interests  previously  enumerated,  together  with  the  advisory  members, 
may  upon  occasion  constitute  a  General  Dock  Council. 

"The  functions  of  the  General  Dock  Council  shall  be  purely  advisory 
and  recommendatory,  looking  toward  the  largest  measure  of  joint  ac- 
tion between  employers,  employees  and  the  Government  in  the  develop- 
ment of  maritime  commerce  and  for  promoting  the  legitimate  interests 
of  all  engaged  therein.  To  this  end  it  may  give  consideration  and  make 
recommendations  with  respect  to  the  standardizing  of  working  condi- 
tions, the  regularizing  of  employment,  the  establishment  and  enforce- 
ment of  general  standards  to  insure  health,  safety  and  efficiency,  the 
cooperation  with  adjustment  agencies  in  other  industries  in  matters  of 
common  interest,  and  the  representation  to  the  Government  of  the  needs 
of  the  industry." 


506  PERSONNEL  ADMINISTRATION 

In  the  branch  of  the  marine  industry  devoted  to  the  operation 
of  harbor  craft  there  is  proposed  the  National  Harbor  Industrial 
Council  whose  general  scheme  of  organization  and  functioning 
are  practically  the  same  as  for  the  longshore  craft. 

It  is  idle  to  speculate  about  the  possible  success  of  these  several 
agencies,  but  it  is  not  without  importance  to  see  how  closely 
they  parallel  the  English  plan;  how  carefully  they  plan  to  keep 
in  touch  with  all  local  groups;  how  urgently  the  need  for  a 
hierarchy  of  organization  from  shop  through  locality  and  dis- 
trict to  national  bodies  is  held  in  view. 

Warning  on  one  point,  however,  cannot  be  too  strongly  given. 
The  council  should  avoid  functioning  as  an  arbitrator.  It  should 
confine  itself  to  bringing  the  parties  together,  to  supplying  in- 
formation, to  offering  dispassionate  counsel  to  all.  As  soon  as 
it  tries  to  decide  the  rights  and  wrongs  of  specific  cases,  it  becomes 
involved  in  local  quarrels;  and  the  chances  of  its  having  the 
continued  respect  of  whichever  party  happens  to  feel  temporarily 
aggrieved  by  decisions,  are  reduced. 

There  is  another  lesson  from  the  English  experience  which  is 
not  to  be  forgotten.  The  method  of  voting  in  the  council  should 
be  such  as  to  require  a  substantial  majority  of  both  sides  to  assent 
to  a  proposition  before  it  is  adopted.  That  need  not  mean  that 
each  side  votes  as  one  unit;  only  that  there  is  virtual  unanimity 
as  to  the  advisability  of  every  course  of  action  adopted. 

A  further  word  of  emphasis  may  well  be  added  to  what  the 
paragraphs  quoted  above  indicate  as  to  the  scope  of  the  con- 
ference dealings.  While  certain  subjects  are  listed  for  considera- 
tion, it  must  eventuate  in  practice  that  every  subject  connected 
with  the  industry  may  under  the  council  scheme,  come  to  the 
attention  of  the  conference.  We  have  already  indicated  in 
several  places,  for  example,  that  these  councils  can  perform  a 
signal  service  in  the  way  of  rogularization  of  work  and  in  the 
direction  of  a  sound  organization  of  the  demand  for  the  product. 
And  one  reason  why  we  are  hopeful  that  industry-wide  joint 
organization  can  begin  to  make  this  stabilization  possible  is 
because  all  the  subtle  elements  of  the  rcgularization  process 
may  come  under  the  scrutiny  of  the  council.  Workers  ami 
managers  alike,  both  with  a  direct  interest  in  steady  work,  can 
together  agree  upon  a  course  of  action  which  neither  alone  could 
or  should  attempt.  And  it  is  just  so  with  all  the  other  matters 
before  the  councils.  It  is  because  they  are  joint  conferences 


NATIONAL  INDUSTRIAL  COUNCILS  507 

that  there  can  issue  from  them  proposals  and  decisions  which 
look  in  the  direction  of  benefiting  the  condition  of  all  who  are 
parties  to  the  industry. 

To  those  who  have  been  inclined  to  accept  the  view  that  the 
labor  problem  is  in  one  aspect  a  problem  of  the  government  of 
industry,  it  will  appear  readily  enough  that  we  have  in  industrial 
councils  a  logical  elaboration  of  the  governmental  structure  of 
our  economic  life.  Industry  has  in  these  councils  a  body  of  such 
representative  character,  that  it  can  naturally  consider  the 
questions  which  affect  an  entire  industry.  They  become  the 
parliaments  of  the  several  industries.  They  can  function  as  the 
mouthpiece  and  administrative  agency  of  industries,  in  dealings 
with  governmental  bodies  and  consumers. 

And  just  as  surely  as  the  single  councils  have  any  justification, 
a  council  of  councils  will  come  logically  to  be  demanded — a 
national  economic  conference  whose  possibilities  are  still  a 
matter  for  speculation.  Such  a  body,  we  can  imagine,  will  play 
an  important  part  in  relations  with  the  International  Labor  Com- 
mission created  by  the  peace  treaty  and  with  whatever  official 
international  economic  bodies  come  subsequently  into  being.1 

Further  Objections. — A  wholly  erroneous  idea  will  have  been 
conveyed  if  it  is  understood  that  we  favor  the  adoption  of  coun- 
cils identical  in  every  particular  with  those  of  England.  We 
have  already  cited  several  important  objections;  and  it  is  well 
to  summarize  our  conclusions  further. 

The  omission  of  consumers  from  such  councils  seems  to  us  a 
serious  defect.  We  recognize  that  consumers  are  in  this  country 
poorly  organized,  as  consumers;  and  in  the  absence  of  such 
organization,  we  admit  that  only  less  effective  expedients  are  at 
hand.  But  the  immediate  expedient  of  having  a  number  of 
" public"  representatives  is  better  than  nothing.  Such  delegates 
(equal  in  number  to  the  employer  and  employee  members  of  the 
council)  might,  for  example,  be  chosen  by  the  Secretaries  of 
Commerce  and  of  Labor  jointly;  or  by  the  two  sides  in  con- 
ference; or  in  whatever  way  it  was  felt  that  a  high  minded  and 
enlightened  representation  of  the  public  and  consuming  interest 
would  be  assured.  But  the  principle  of  the  representation  of  the 
consumer  is  sound,  and  is  a  needed  corrective  to  the  possible 
conspiracy  of  employer  and  employee  against  the  consumer. 

1  Further  discussed  in  TEAD,  ORDWAY,  The  People's  Part  in  Peace, 
Chapters  V  and  VI. 


508  PERSONNEL  ADMINISTRATION 

At  the  outset  in  this  country,  such  conference  bodies  should 
have  only  the  power  which  derives  from  moral  suasion  and  the 
winning  power  of  a  sound  and  economically  beneficent  idea. 
The  initial  work  of  industrial  councils  must  necessarily  be 
educational  of  the  constituencies  on  both  sides.  This  must 
precede  more  determinative  action.  Moreover,  only  as  a  large 
per  cent,  of  employers  and  of  the  workers  feel  that  they  are 
really  represented  in  the  council  can  it  proceed  to  anything 
resembling  serious  administrative  work  or  advance  to  policy 
determination  which  is  anything  but  advisory  in  a  most  general 
sense. 

The  present  weakness  of  the  two  participating  associations  in 
so  many  American  industries  will  be  pointed  to  by  some  as  an 
insuperable  defect.  Councils  require,  it  will  be  said,  that  the 
labor  unions  in  an  industry  be  very  strong.  There  is  no  escape 
from  this  conclusion.  Yet  in  the  absence  of  anything  approach- 
ing 100  per  cent,  organization,  much  can  be  done  through  the 
use  of  delegates  of  employees'  associations  and  shop  committees. 
In  our  judgment,  however,  the  definite  encouragement  of  strong 
national  organization  on  both  sides  is  a  definite  business  asset 
to  each  individual  firm. 

One  may  object  that  the  workers'  national  organizations  have 
this  or  that  defect;  and  the  objection  may  be  all  too  true.  But 
there  is  nevertheless  a  general  law  of  economy  in  the  growth 
of  institutions  which  applies  here  as  elsewhere;  a  law  which 
says  that  any  institutional  changes  have  to  start  from  the  con- 
ditions and  institutions  of  the  moment,  and  that  society  has  in 
consequence  to  commence  its  reforms  with  groups  as  they  are 
rather  than  with  them  as  it  wishes  they  were.  This  will,  we 
believe,  prove  substantially  true  of  the  national  labor  groups  of 
today.  They  have  their  admitted  defects;  but  unless  they  ex- 
hibit a  lack  of  responsiveness  to  new  conditions  which  has  not 
before  been  apparent,  they  are  the  bodies  through  which  the 
workers'  end  of  the  councils  can  confidently  be  counted  on  to 
develop.  And  judging  by  the  progress  thus  far  made  in  the 
consideration  of  the  council  idea  by  American  industries,  the 
serious  obstacles  to  joint  organization  are  not  being  raised  by 
those  on  the  workers'  side. 

There  may,  finally,  arise  an  objection  that  industrial  councils 
mean  the  injection  of  "politics"  into  industry.  Such  an  objec- 
tion would  indicate  a  fundamental  misunderstanding  of  the 


NATIONAL  INDUSTRIAL  COUNCILS  509 

purpose  of  the  council;  but  it  should  be  carefully  considered. 
What  this  presumably  means  is  that  issues  will  be  decided 
not  on  their  merits,  not  scientifically,  but  because  of  more  or  less 
covert  personal  influences.  It  means  a  fear  that  red  tape,  bu- 
reaucracy and  delay  may  enter  industry ;  that  the  indecision  and 
cumbersomeness  of  operation  which  appears  to  characterize  so 
much  of  governmental  action,  may  appear  also  in  business. 

Industry  must  indeed  be  protected  from  "politics"  so  defined. 
To  contemplate  industry  ridden  with  this  sort  of  "politics" 
must  seem  to  every  serious  administrator  a  veritable  nightmare. 
And  there  is,  unquestionably,  a  real  danger  that  such  tendencies 
will  grow  in  influence.  But  their  growth,  we  are  clear,  will 
not  be  due  to  industrial  councils  or  to  any  other  form  of  co- 
operative action  among  the  interested  parties.  It  will  be  due 
to  the  absence  of  such  cooperation,  due  to  the  difficulties  in- 
herent in  large-scale  management;  due  to  the  demand  for  stand- 
ardized, cut-and-dried  performance  which  the  nepotism  of 
inherited  ownership  invites  as  the  cloak  with  which  to  cover  its 
inefficiency.  It  will  be  due,  as  it  already  is  in  the  government, 
to  the  fact  that  the  directly  interested  parties  are  not  sharing 
in  the  determination  of  working  methods  and  terms  of  employ- 
ment, and  hence  are  unable  to  bring  easily  to  light  and  have 
discussed  and  corrected  the  evils,  stupidities  and  inefficiencies 
of  bureaucracy.  "Politics"  in  its  bad  sense  industry  has  no 
room  for,  if  it  wishes  to  become  truly  productive.  But  politics 
in  the  sense  of  study  toward  a  structure  intelligently  devised 
for  effective,  autonomous  control,  representation  of  the  actively 
interested  parties  and  determination  of  policy  on  a  basis  of 
voluntary  consent,  industry  not  only  has  a  place  for,  but  it 
cannot  get  on  without. 

It  may  have  seemed  to  some  that  our  constant  use  of  govern- 
mental analogies  in  discussing  industrial  questions  is  somewhat 
strained.  But  it  is  daily  clearer  to  those  who  are  watching 
closely  the  play  of  economic  forces,  that  the  problem  of  problems 
today  is  to  find  out  how  our  economic  and  industrial  life  can  be 
lived  in  harmony  with  those  principles  of  political  freedom  and 
autonomy  which  are  our  proud,  national  birthright.  And  broadly 
speaking  it  is  true  that  until  our  country  is  prepared  to  realize 
that  industry  is  a  proper  sphere  for  democratic  government — 
ultimately  for  genuine  self-government — most  rapid  progress 
will  be  blocked,  because  vision  and  purpose  are  inadequate. 


510  PERSONNEL  ADMINISTRATION 

Councils  in  the  Civil  Service. — The  idea  of  joint  standing 
bodies  is  obviously  applicable  to  the  relations  of  federal  em- 
ployees with  the  federal  government.  In  Great  Britian,  where 
the  extension  of  the  council  idea  into  the  civil  service  has  now 
resulted,  it  is  agreed  that  the  four  following  important  purposes 
can  be  served  by  such  a  joint  council  for  government  employees: 

"  1.  Provision  of  the  best  means  for  utilizing  the  ideas  and  experience 
of  the  staff. 

"2.  Means  for  securing  to  the  staff  a  greater  share  in  and  responsi- 
bility for  the  determination  and  observance  of  the  conditions  under 
which  their  duties  are  carried  out. 

"3.  Consideration  of  the  general  principles  governing  conditions  of 
service,  e.g.,  recruitment,  hours,  promotion,  salary,  and  superannuation. 

"4.  The  encouragement  of  further  education  of  civil  servants  and 
their  training  in  higher  administration  and  business  organization."1 

There  is  as  much  reason  for  this  type  of  organization  here 
as  there  is  in  England.  The  problem  of  industrial  relations 
with  federal  employees  and,  indeed,  with  state,  county  and 
municipal  employees,  is  certainly  no  easier  than  the  same 
problem  in  "private"  plants;  and  it  is  frequently  complicated 
in  the  absence  of  adequate  channels  of  joint  conference,  by  the 
unwholesome  interference  of  politicians  in  affairs  of  the  public 
service.  And  this  interference  while  it  may  effect  an  immediate 
settlement  of  certain  issues  like  pay  and  hours,  does  not  tend 
to  strengthen  the  morale  of  the  service,  its  efficiency  or  its  good- 
will toward  the  federal  government  as  employer.  It  is  in  truth 
an  injection  of  "politics"  in  the  invidious  sense  above  referred  to. 

For  these  reasons,  the  proposal  of  joint  councils  to  supply  a 
place  for  the  joint  deliberations  of  governmental  administrators 
and  the  personnel  whose  action  they  direct,  is  not  to  be  summarily 
dismissed.  A  council  here  promises  exactly  what  it  promises 
in  other  industries.  It  promises  to  pave  the  way  for  more  en- 
lightened personnel  policies,  for  a  greater  development  of  in- 
terest in  the  industry  by  the  workers,  for  a  better  basis  of  mutual 
understanding  and  confidence  than  can  ever  exist  so  long  as  no 
national  joint  agency  is  present. 

Selected  References 

BEN.N,  E.  J.  P.     Trade  of  Tomorrow.     N.  Y.,  E.  P.  Dutton,  1918. 
BUREAU    OF    INDUSTRIAL    RESEARCH.     Industrial    Council  Plan  in  Great 
Britain.     N.  Y.,  Bureau  of  Industrial  Research,  1919. 

1  Quoted  in  The  Monthly  Labor  Review,  U.  S.  Department  of  Labor, 
July,  1919,  p.  12(1. 


NATIONAL  INDUSTRIAL  COUNCILS  511 

COLE,  G.  D.  H.      Industrial  Councils  of  Great  Britain.     (In  Dial,  v.  66, 

pp.  171-173,  Feb.  22,  1919.) 
COLE,  G.  D.  H.     Self-Government  in  Industry.     London,  G.  Bell  &  Sons, 

1917. 
GARTON    FOUNDATION.     Memorandum   on  the    Industrial   Situation  after 

the    War.       Philadelphia,    U.    S.   Shipping   Board,    Emergency    Fleet 

Corporation,  1918. 
GARTON  FOUNDATION.     The  Industrial  Council  for  the  Building  Industry. 

London,  Harrison  and  Sons,  1919. 
SPARKES,   MALCOLM  and  OTHERS.     Planning  the  New    Industrial  Order; 

What  the  Building  Trades  Parliament  of  Britain  is  doing.     (In  World 

Tomorrow,  v.  2,  pp.  320-326,  Dec.,  1919.) 
TEAD,    OHDWAY.     Industrial    Councils.     (In    People's   Part  in  Peace,  pp. 

91-130.) 
WOLFE,     A.     B.      Works     Committees     and     Joint     Industrial     Councils. 

Philadelphia,   U.  S.  Shipping  Board,   Emergency  Fleet    Corporation, 

1919. 


CHAPTER  XXXV 
THE  PURPOSE  OF  INDUSTRIAL  GOVERNMENT 

The  government  of  industry  presents  a  problem  of  economic 
and  human  relationships  vastly  more  complex  than  that  found 
in  the  field  of  so-called  political  government.  This  affords 
perhaps  the  best  possible  justification  for  our  drawing  as  heavily 
as  we  have  upon  the  political  wisdom  and  experience  of  the  past. 
For  we  have  throughout  this  volume  been  relating  political 
truths  to  industrial  problems  wherever  comparable  situations 
could  be  discovered.  We  have  been  enlarging  upon  one  impor- 
tant administrative  detail  after  another,  estimating  proposals 
and  procedure  in  the  light  of  a  growing  knowledge  of  the  charac- 
teristics and  potentialities  of  human  nature,  and  of  a  growing 
experience  in  politics  and  in  personnel  management. 

In  America's  political  tradition  certain  aims  and  purposes 
have  come  to  have  a  high,  if  not  a  supreme,  value.  We  in  this 
country  hold  it  as  "self-evident"  that  "all  men  are  created  free 
and  equal" — in  the  sense  of  having  the  right  to  equal  opportunity. 
We  hold  that  the  right  to  life,  liberty  and  the  pursuit  of  happiness 
are  under  ordinary  conditions  inalienable  rights.  We  cherish  a 
faith  on  which  our  political  structure  is  built,  that  life  and 
happiness  are  best  assured  when  there  is  government  of  the 
people,  by  the  people  and  for  the  people. 

There  is  an  unparalleled  fineness  about  America's  tenacious 
hold  upon  these  aims  and  ideals.  That  we  have  not  done  more 
to  realize  them  than  we  have,  is  indeed  cause  for  discouragement 
and  heart  searching.  But  one  conspicuous  reason  has  certainly 
been  that  as  a  people  we  have  been  groping  toward  practical 
methods,  have  been  experimenting  with  and  choosing  forms  which 
seemed  most  readily  adapted  to  realizing  the  democratic  spirit; 
and  the  end  of  that  period  of  search  and  choice  is  still  far  in  tho 
future. 

There  is,  we  shall  probably  admit  if  we  are  thoroughly  honest, 
a  pathetic  cynicism  noticeable  today  throughout  society,  which 
is  to  be  partly  accounted  for  by  our  failure  to  move  faster  toward 
genuine  political  democracy.  But  it  is  even  more  to  be  explained, 

512 


THE  PURPOSE  OF  INDUSTRIAL  GOVERNMENT         513 

we  believe,  because  of  a  wholesale  failure  to  apply  in  our  industrial 
life  either  the  spirit  or  methods  which  are  consistent  with  our 
political  professions. 

The  American  tradition  of  democratic  control,  of  essential 
public  activities  as  public  service,  of  the  supreme  worthfulness 
of  the  individual  life,  has  been  almost  completely  divorced  from 
industrial  developments.  Industry  as  an  institution  has  in  a 
sense  been  in  conflict  with  the  community;  the  conflict  has 
brought  disappointments,  fears  and  hates;  and  these  have  in 
turn  brought  unhappiness. 

In  our  vast  political  experiment,  doubtful  as  its  concrete 
results  may  often  seem,  we  have  affirmed  certain  basic  truths 
which  look  in  the  direction  of  that  release  and  real  liberation 
of  human  talents  which  seem  to  be  a  condition  of  human  hap- 
piness. We  have  to  that  extent  made  significant  progress. 

We  have  affirmed  the  unique  value  of  personality. 

We  have  believed  that  liberty,  equal  opportunity  and  a 
fraternal  attitude  were  necessary  conditions  of  that  self-develop- 
ment which  gives  quality  and  richness  to  each  individual  life. 

We  have  professed  that  in  the  common  life  of  a  democracy 
there  can  be  no  peace  or  sanity  or  improvement  in  the  quality 
of  life  unless  a  motive  of  public  service  is  dominant  in  the  adminis- 
tration of  those  affairs  which  affect  all  the  people.  At  heart  we 
are  convinced  that  when  there  must  be  organized  activity  in  the 
community  to  provide  for  primary  human  needs,  that  organized 
effort  should  be  in  the  public  interest  and  constitute  in  fact  as 
well  as  in  name,  a  public  service. 

We  might  even,  if  our  thinking  were  resolved  into  fundamental 
terms,  be  prepared  to  admit  that  the  purpose  of  the  state  is  to 
afford  a  "good  life"  for  all  individuals  in  the  state. 

But  in  industry  we  have  little  progress  of  this  sort  to  record. 
There  is  rather  confusion  and  ill  will  and  strife.  For  in  industry 
there  has  been  as  yet  too  little  acceptance  of  the  value  of  human 
life  as  an  end  in  itself;  too  little  liberty  and  equal  status;  too 
little  recognition  that  our  economic  life  really  constitutes  the 
most  significant  public  service  of  our  generation. 

And  most  fundamental  of  all,  there  has  been  too  little  under- 
standing that  if  the  purpose  of  the  community's  organized  life  is 
to  minister  to  the  good  life  of  all  individuals  in  it,  there  must  be 
some  attempt  to  achieve  a  good  life  in  that  major  part  of  the 
citizen's  time  which  is  spent  in  earning  his  daily  bread. 

In  short,  in  the  administration  of  its  human  affairs  industry 


514  PERSONNEL  ADMINISTRATION 

lacks  standards.  It  lacks  any  clear  agreement  as  to  what  all 
its  own  turmoil  and  sweat  and  anxiety  are  for.  It  lacks  a  crite- 
rion in  the  light  of  which  its  own  efforts  can  be  evaluated. 

The  hope  for  our  industrial  future — the  hope  that  it  can  be 
productive,  joyous,  contributive  to  the  life  of  every  member  of 
the  community — appears,  therefore,  to  lie  in  our  ability  to  make 
its  practices  square  with  our  historic  political  faith.  Our  hope 
lies  in  the  release  of  positive,  creative  impulses  in  all  our  people 
in  and  through  their  work;  in  a  wide  recognition  that  industry 
can  be  public  service  if  we  will  only  make  it  so. 

As  soon,  then,  as  agreement  can  be  reached  among  the  inter- 
ested groups  that  industry  is  for  service  and  that  this  service 
must  be  rendered  in  a  way  consistent  with  the  development  of 
individual  personality,  a  tremendous  step  will  have  been  taken 
toward  a  purpose  at  once  scientific  and  human.  Standards 
and  criteria  will  begin  to  emerge;  and  a  sense  of  direction  will 
be  restored.  Study  of  wise  methods  will  go  rapidly  forward 
and  fertile  results  will  be  forthcoming.  We  shall  have  supplied 
for  industry  the  purpose  and  the  methods  which  it  needs  to  bring 
it  into  harmony  with  the  professions  of  a  democratic  country. 

Such  agreement  on  purpose  and  methods  on  any  wide  scale 
may  be  a  long  way  off.  But  there  are  evidences  of  a  new  out- 
look, a  new  purpose,  a  new  determination  to  harmonize  the  aims 
of  our  industrial  life  with  those  political  aspirations  of  America 
which  are  at  bottom  lofty  and  spiritual  because  they  are  demo- 
cratic and  intensely  human.  And  happily  those  evidences 
come  not  from  one  group  in  society  but  from  all. 

A  prominent  engineering  consultant,  for  example,  has  recently 
affirmed  that:  "We  have  proved  in  many  places  that  the  doctrine 
of  service  which  has  been  preached  in  the  churches  as  religion  is 
not  only  good  economics  and  eminently  practical,  but  because  of 
the  increased  production  of  goods  obtained  by  it,  promises  to  lead 
us  safely  through  the  maze  of  confusion  into  which  we  seem  to 
be  headed,  and  to  give  us  that  industrial  democracy  which  alone 
can  afford  a  basis  for  industrial  peace."1 

A  progressive  capitalist  like  the  younger  Mr.  Rockefeller  adds 
his  testimony:  "The  day  has  passed  when  the  conception  of 
industry  as  chiefly  a  revenue  producing  process  can  be  main- 
tained. To  cling  to  such  a  conception  is  only  to  arouse  antago- 
nisms and  to  court  trouble.  In  the  light  of  the  present,  every 
thoughtful  man  must  concede  that  the  purpose  of  industry 

1  GANTT,  HENRY  L.    Organizing  for  Work,     p.  104. 


THE  PURPOSE  OF  INDUSTRIAL  GOVERNMENT         515 

is  quite  as  much  the  advancement  of  social  well-being  as  the 
accumulation  of  wealth."1 

The  trade  unions  of  England  in  a  recent  appeal  to  their  govern- 
ment are  clear  that:  "It  is  not  enough  merely  to  tinker  with 
particular  grievances  or  to  endeavour  to  reconstruct  the  old 
system  by  slight  adjustments  to  meet  the  new  demands  of 
Labour.  It  is  essential  to  question  the  whole  basis  on  which 
our  industry  has  been  conducted  in  the  past  and  to  endeavor 
to  find,  in  substitution  for  the  motive  of  private  gain,  some  other 
motive  which  will  serve  better  as  the  foundation  of  a  demo- 
cratic system.  This  motive  can  be  no  other  than  the  motive 
of  public  service,  which  at  present  is  seldom  involved  save  when 
the  workers  threaten  to  stop  the  process  of  production  by  a  strike. 
The  motive  of  public  service  should  be  the  dominant  motive 
throughout  the  whole  industrial  system,  and  the  problem  in 
industry  at  the  present  day  is  that  of  bringing  home  to  every 
person  engaged  in  industry  the  feeling  that  he  is  the  servant, 
not  of  any  particular  class  or  person,  but  of  the  community 
as  a  whole.  This  cannot  be  done  so  long  as  industry  continues 
to  be  conducted  for  private  profit,  and  the  widest  possible 
extension  of  public  ownership  and  democratic  control  of  in- 
dustry is  therefore  the  first  necessary  condition  of  the  removal 
of  industrial  unrest."2 

And,  finally,  a  group  of  English  employers  have  made  the 
prophetic  declaration  that: 

"It  sounds  across  the  whole  industrial  arena,  the  trumpet 
call  of  a  new  idea — the  conception  of  our  industry  as  a  great 
self-governing  democracy  of  organized  public  service. 

"We  have  endeavoured,  we  hope  successfully,  to  outline  the 
true  foundation  for  such  a  consummation,  namely: 

"Freedom  and  security  for  initiative  and  enterprise. 

"Complete  removal  of  the  fear  of  unemployment. 

"Salaries  to  management  commensurate  with  ability. 

"Hire  of  capital  at  the  market  rate  of  good  securities. 
, "  Provision    of    common    services    controlled    by    the    whole 
industry,  and  financed  from  its  surplus  earnings. 

"We  have  not  hesitated  to  make  great  demands,  for  the  emer- 
gency and  the  opportunity  are  also  great,  and  this  is  no  time 
for  dalliance. 

1  ROCKEFELLER,  J.  D.,  JR.     Representation  in  Industry,  Annals,  American 
Academy  of  Political  and  Social  Science,  January,  1919,  p.  168. 

2  The  Survey,  May  3,  1919,  p.  228. 


516  PERSONNEL  ADMINISTRATION 

"We  believe  that  the  spectacle  of  organized  management  and 
labour,  uniting  their  constructive  energies  upon  a  bold  scheme 
of  reorganization  and  advance,  will  transform  the  whole  atmos- 
phere of  our  industrial  life,  and  that  the  force  of  a  great  example 
is  the  only  thing  that  will  lead  the  way  to  the  commonwealth 
that  all  men  of  goodwill  desire."1 

But  industry  for  use  and  service  means  industry  for  the 
development  of  the  citizens  in  industry.  Industry  to  be  funda- 
mentally serviceable  must  also  be  adequately  self-expressive. 
The  two  aims,  service  and  personality,  are  really  complementary 
— two  ways  of  expressing  the  central  truth  that  industry  justifies 
itself  to  the  extent  that  it  ministers  to  man  as  a  producer  no  less 
than  as  a  consumer.  At  the  center  of  all  values  in  industry 
stands  the  precious,  unique  value  of  each  individual  personality 
in  the  community.  And  it  is  precisely  because  each  personality 
is  uniquely  precious  that  only  in  a  democratic  society  and  in  a 
democratic  industrial  organization  can  he  find  self-expression 
and  secure  the  medium  for  his  development. 

The  democratic  tendency  in  industry  is  today  not  embodied 
in  any  one  form  or  type  of  structure.  It  is  rather  gaining  ex- 
pression  wherever  opportunity  is  being  given  for  individual 
life  to  take  on  the  richness,  interest  and  joy  that  are  rightfully 
native  to  it.  Methods  of  representative  control  are  thus  only  a 
means — but  apparently  an  essential  means — to  ends  which  are 
completely  personal.  We  want  representative  machinery  not 
for  its  own  sake,  but  because  it  is  the  only  machinery  in  the  in- 
telligent use  of  which  personal  development  results. 

It  is,  we  believe,  in  the  light  of  such  principles  and  considera- 
tions as  these  that  industrial  practices  are  to  be  intelligently 
discussed  and  weighed.  And  it  is  happily  true  that  those 
methods  are  gaining  in  favor  and  showing  their  practical  success, 
which  are  best  harmonizing  the  claims  of  industrial  productivity 
with  those  of  human  personality. 

What  professional  managers  must  more  and  more  seek,  there- 
fore, in  order  to  reconcile  these  two  vital  ends,  is  an  organization 
within  factories  and  within  industries  which  brings  closer  to 
realization  the  conception  of  each  industry  as  a  great  self-govern- 
ing democracy  of  organized  public  service. 

1  Interim  Report  of  the  Commit I<M  <m  Scientific  Management  and 
Rrdiiftion  of  Costa,  on  Organized  PuMir  Service  in  tin-  Huilding  Industry, 
submitted  to  the  Industrial  Council  for  the  Building  Industry  (Great 
Britain). 


I 


APPENDIX 

Topical  Outline  for  Guidance  of  Students  in  Visiting  Personnel 
Departments 

I.  The  Status  of  the  Personnel  Department 

A.  Is  it  centralized? 

B.  Extent  of  authority  and  responsibility 
II.  Organization  of  the  Personnel  Department 

A.  General  features 

1.  Reasons  for  installing 
,  2.  Number  years  in  operation 

3.  Physical  lay-out  of  offices 

4.  Staff  required 

B.  Method  of  organization 

1.  Title  of  person  in  charge 

2.  To  whom  responsible? 

3.  Appropriation 

4.  Staff  required 

5.  System  of  files,  records  and  forms 

C.  Functions 

1.  Employment 

(a)  Plant  requirements 

1.  Working  for-ce,  total,  peak,  seasonal 

2.  Types  of  people  hired  through  department 

3.  Sources  of  supply 

(a)  Outside  of  plant 
(&)  Within  the  plant 

4.  Method  of  requisition 
(&)  Method  of  selection 

1.  Questions  and  tests  used 

2.  Restrictions,  standards,  job  specifications 

3.  Extent    of    foreman's    or    superintendent's    re- 

sponsibility 

4.  Obligation  to  applicant 

(a)  Explanation  of  plant  policies,  coaditions  of 

work  and  pay 
(&)  Information  booklet 

5.  Introduction  to  the  plant 

(a)  To  other  employees 

To  foreman 
(6)  Explanation  of  job 

(c)  "Follow  up"  to  determine  success  of  selection 

(d)  "Follow  up"  to  determine  transfer,  promotion,    dis- 

charge 

517 


518  PERSONNEL  ADMINISTRATION 

2.  Factory  hygiene 

(a)  Fire  prevention  and  protection 

1.  Policies  as  to 

(a)  Reduction  of  hazards  to  life 
(fe)  Cooperation  of  employees 
(c)  Fire  drills 

2.  Responsibility  for  inspection  and  maintenance 
(6)  Accident  prevention  and  protection 

1.  Policies  as  to  mechanical  safeguards,  first  aid,  etc. 

2.  Responsibility  for  inspection  and  maintenance 

3.  Records  of  causes 

4.  Cooperation  of  employees  through 

(o)  Education,  suggestion  systems,  committees 

(c)  Maintenance  of  plant 

1.  Responsibility  for  periodic  check  up,  and  recom- 
mendations for  improvement  in 
(a)  Working  hazards 

1.  Occupational  hazards 

2.  Ventilation  and  heating 

3.  Removal  of  air  impurities 

4.  Lighting 

5.  Noise  and  vibration 

6.  Postures  as  adapted  to  work 

7.  Rest  periods 

8.  Purity  of  drinking  water 

9.  Hot  and  sufficient  food 

(6)  Factory    housekeeping:    Windows,    wash- 
rooms, floors,  bubblers,  etc. 

(d)  Medical  care 

1.  Who  is  responsible  for,  what  facilities  are  there 

and  who  pays  the  cost  of 
(a)  First  aid 

(6)  Nurses,     doctors,     hospital,     dental     de- 
partment 

(c)  House  visits 

(d)  Fatigue  study 

(*)  General  health  educational  policy 

3.  Training 

(a)  Job  instruction 

.  1.  For  workers 

2.  For  foremen 

3.  Methods  of  instruction 

(b)  Policies  in  regard  to 

1.  Technical  training  for  advancement 

2.  Education  in  maintaining  factory  standards 

3.  English  classes 

4.  General  educational  features 

5.  Responsibility  for  conducting  above 

(c)  Transfer  policy 


APPENDIX  519 

(d)  Promotion  policy 

(e)  Suggestion  system 

4.  Miscellaneous  service  functions 

(a)  Physical 

1.  Lunch  rooms — (financial  policy,  extent  of  use) 

2.  Cooperative  purchasing  arrangements 

3.  Transportation  facilities 

4.  Housing  schemes 

(b)  Educational 

1.  Libraries,  lectures,  movies 

2.  Plant  paper 

(c)  Recreational 

1.  Variety;  facilities 

2.  Method  of  organization  and  control 

(d)  Benefit  associations 

1.  Savings  societies 

Purpose,  method  of  operation,  responsibility  for 
funds 

2.  Insurance  associations 

(a)  Type 

(b)  Methods  of  operation 

(c)  Qualifications  for  membership 

5.  Maintenance  of  working  force  and  amicable  joint  relations 

(a)  Problems  where  mutual  understanding,   cooperation 
or  careful  adjustment  are  necessary 

1.  Promotion 

2.  Transfer 

3.  Grievance 

4.  Discipline  or  shop  control 

5.  Discharge 

6.  Interview  of  leavers 

7.  Adjusting  pay  errors 

8.  Determination  of  policies  on  working  conditions 

(a)  Working  methods 

(b)  Quantity  and  quality  of  output 

(c)  Hours  of  work 

(d)  Rate  of  pay 

(&)  Methods  for  controlling  these  problems 

1.  Through  personnel  manager 

(a)  Is  there  stated  procedure  for  handling  com- 
plaints and  grievances? 

2.  Employees'  committees 

(a)  Qualification  for  membership 

(b)  Machinery  for  representation  and  election 

(c)  Method  of  organization 

(d)  Problems  handled 

3.  Collective  bargaining  with  organized  labor 
If  there  are  agreements 

(a)  What  are  their  terms? 


520  PERSONNEL  ADMINISTRATION 

(6)  Are  they  satisfactory? 

4.  Plant  history  on  strikes  and  lockouts 

6.  Research 

(a)  Responsibility  for  gathering  and  classifying  informa- 
tion as  to 

1.  Jobs  offered,  types  and  specifications 

2.  Workers  needed,  types  and  qualifications 

3.  Effect  of  job  on  worker 

4    Tardiness  and  absenteeism 

5.  Labor  turnover 

(a)  How  figured 

(6)  Amount  of 

(c)  Causes  of 

(rf)  Cost  of 

(6)  Labor  audit  of  plant 

(c)  Method  of  learning  of  new  developments  in  whole 
personnel  field 

7.  Relation  of  department  to  other  staff  departments 

(a)  How  are  personnel  policies  adopted? 

(6)  Are  production  and  sales  policies  adopted  with  knowl- 
edge of  personnel  department? 

(c)  How  are  personnel  policies  put  into  effect  with  fore- 
men? 

8.  Relation  of  department  to  outside  agencies 

(a)  Responsibility  and  method  of  keeping  in  touch  with 

1.  Legislation 

2.  Court  decisions 

(6)  Policy  as  to  contacts  and  cooperation  with 

1.  Government   bodies,    health    departments,    em- 

ployment service,  schools,  libraries,  etc 

2.  Civic  agencies 

3.  Business  associations 

4.  Organized  labor 
D.  Conclusion 

(a)  What  do  you  consider  the  main  justification  for  your  depart- 
ment? 
(6)  What  do  you  consider  its  limitations? 


INDEX 

(The  "Selected  References"  at  the  end  of  every  chapter  should  also  be 
consulted). 

Aberthaw  Construction  Co.,  on  effects  of  vibrations  in  structures,  121  note. 

Absence,  reduction  of,  241,  242;  record  kept  by  foreman,  241;  follow-up  of, 
241;  causes  of,  242;  selected  references  on,  249;  and  lateness  records, 
263;  control  over,  276;  payment  for,  354. 

Accidents,  records  kept  by  nurse,  98;  causes  of,  101, 115;  committees  on,  103; 
preventive  measures,  103,  113;  importance  of  personal  hygiene  in 
prevention  of,  104;  monthly  report  by  foreman,  106;  annual  number  of, 
184;  records  used  in  job  analysis,  263;  compensation  for,  317,  354,  363; 
as  an  industrial  risk,  Chap.  XXV,  361. 

Advertising,  a  source  of  labor  supply,  43;  safety,  104;  in  company  magazine, 
190;  promotional  opportunities,  232,  shop  rules,  239;  policies,  387,  400. 

Alford,  L.  P.,  410  note. 

Adjustment,  and  joint  relations,  as  a  division  of  personnel  work,  31;  defini- 
tion of,  31;  duties  assigned  to  division  of,  35;  on  employment  standards, 
64;  on  time  factors,  67;  on  hours  and  working  periods  standards,  83, 
472;  on  elements  of  process,  211,  473;  on  job  analysis,  212,  258,  267,  270, 
279,  346;  on  suggestions  systems,  215;  in  shop  control,  240, 473,  477;  on 
causes  of  discharge,  246,  476;  on  wage  determination,  330,  335,  472; 
on  profit  sharing,  349;  on  insurance,  366;  necessity  of,  479,  496;  in 
government  service,  510. 

Alschuler,  S.,  419  note. 

Amalgamated  Clothing  Workers  of  America,  joint  arrangement  with  men's 
clothing  industry  contemplated,  503. 

American  Association  for  Labor  Legislation,  health  educational  work,  95. 

American  Federation  of  Labor,  its  movement  for  a  six  hour  day,  71 ;  president's 
endorsement  of  medical  examination  of  workers,  87;  on  increased  pro- 
ductivity and  job  analysis,  258;  opposed  to  company  unions,  412,  430, 
431;  building  trade  department  of,  461  note,  503. 

American  Journal  of  Sociology,  on  standards  of  industrial  intelligence, 
201  note. 

American  Labor  Legislation  Review,  on  prevention  of  unemployment, 
405  note. 

American  Medical  Association,  health  educational  work,  95. 

American  Rolling  Mill  Co.,  rating  scale  for  foremen,  59. 

American  Social  Hygiene  Association,  health  educational  work,  95. 

American  Society  of  Mechanical  Engineers,  on  labor  turnover  records, 
286  note. 

Arnold,  M.,  411. 

Appendix,  517-520. 

Applicants,  relation  of  interviewer  to,  50,  51;  qualifications  of,  51;  treat- 
ment of,  53;  to  determine  abilities  of,  58;  rejecting,  60,  88;  placing 
elsewhere  of  rejected,  60;  initial  physical  examination  of,  86. 

521 


522  INDEX 

Apprentice,  training,  180,  186,  487;  principles  of  training,  181;  shops,  181; 

training  period,  181,  186;  cooperative  school  for,  182;  extension  classes 

for,  186;  in  the  printing  trade,  487,  501. 
Approval,  desire  for,  18;  an  element  in  work  interest,  200. 
Aristotle,  20. 

Art  in  Buttons,  rating  scale  for  foremen,  59. 
Arthur  and  Woodrow,  55  note. 
Association,  desire  for,  17;  constructive  force  of,  17;  with  foreign  speaking 

groups,  42;  cooperative,  410,  439,  482;  types  of  trade,  483,  484  note; 

national,  484,  489;  membership  in  trade,  495. 
Attendance,  bettering,  242;  records,  242;  bonus  for  regular,  243;  policy  on 

regular,  242,  275;  and  wages,  332;  irregular,  397. 

Babcock,  G.  D.,  329  note. 

Bassett,  W.  R.,  209  note,  212  note. 

Baths,  effects  of  shower,  129;  equipment  of  company,  129. 

Beatty,  A.  J.,  146  note. 

Beauty,  love  of,  19;  in  factory  exterior,  132. 

Bethlehem  Steel  Company,  on  committee  classifications,  433. 

Beveridge,  W.  H.,  45  note. 

Bingham,  W.  V.,  57  note. 

Bleachery  Life,  on  unemployment  sinking  fund  plan,  368  note. 

Bloomfield,  D.,  166  note. 

Sidney  Blumenthal  Company,  "federal  plan"  of,  411. 

Bodily  integrity,  13;  as  basis  of  national  progress,  14;  as  basis  of  economic 

and  social  efficiency,  84. 
Bonus,  schemes,  value  to  company,  330,  359;  basis  for  annual,  333;  for 

night   work,   355;  for  membership,   364;   "economy  dividend,"   443; 

effect  of,  459. 

Boston  Transcript,  on  vacation  plans,  354  note. 
Brailsford,  H.  N.,  221  note. 
British  Building  Industry,  factors  restricting  output,  344  note;  on  profit 

sharing  plans,  350  note;  498  note;  on  industrial  government,  516  note. 
British  Labor  Party,  platform  of,  222. 
Browne  &  Sharpe,  apprentice  school,  181. 

Bulletin  boards,  used  for  safety  publicity,  104;  material  for,  104,  238. 
Bureau  of  Industrial  Research,  reprints,  412   note;  comparative   analysis 

of  shop  committee  plans,  418  note;  on  council  movement,  493  note. 
Burkhard,  P.  L.,  345  note. 
Burritt,  A.  W.,  345  note. 

Cadillac  Company,  apprentice  school,  181. 

Chandler,  W.  L.,  363  note,  364  note,  366  note. 

Charts,  description  of,  36,  391;  showing  major  functions  of  personnel  depart- 
ment, 37;  showing  administrative  divisions  and  duties  of  personnel 
department,  38;  showing  lines  of  authority  and  responsibility  in  person- 
nel department,  39;  used  in  publishing  costs,  209;  in  transfer  and  promo- 
tion, 228;  230;  Hoopingarner's  labor  loss,  288;  used  of  executive 
organization,  300;  of  typical  organization,  IV,  375,  391. 


INDEX  523 

Christian  Science  Monitor,  187  note. 

Cleveland,  F.  A.  and  Schafer,  J.,  357  note. 

Clewell,  C.  E.,  119  note. 

Clinics,  company  corrective,  88;  dental,  89. 

Cloak  and  Suit  Industry  of  New  York  City,  joint  board  of  sanitary  control 
for,  96. 

Collective  bargain,  a  function  in  personnel  activity,  27,  458;  discharge  clause 
in,  247;  about  work,  269,  471,  476;  about  pay,  269,  328,  330,  337,  338 
note,  368,  459;  based  on  job  analysis,  269,  473;  an  item  in  labor  audit, 
313;  use  of,  407,  458,  471;  definition  of,  411,  447;  business  value  of, 
Chap.  XXXI,  446,  450,  457,  Chap.  XXXII,  459,  468,  479;  objections  to, 
460,  473,  474;  violations  of,  461,  464;  as  a  contract,  465;  protects  worker, 
469,  477;  educational  value  of,  470,  478,  480;  subject  matter  of,  472; 
shortcomings  of,  473;  selected  references  on,  480. 

Colyer,  N.,  146. 

Committee,  systems,  used  in  developing  executives,  147;  functions  of,  147; 
425;  reasons  for  appointing  executives  on,  148;  on  fuel  economy,  149; 
membership  of  operating,  377;  function  of  operating,  377,  378,  384; 
composition  of  personnel,  379;  function  of  production,  382;  classifica- 
tions, 433. 

Commons  and  Andrews,  465  note,  467  note. 

Commons,  J.  R.,  409,  410  note,  429  note. 

Company  Magazine,  Chap.  XIV,  189,  302;  purpose  of,  189,  193,  198;  need 
of,  189;  types  of,  190;  management  of,  190;  its  editorial  staff,  191;  its 
contents,  191-196;  its  educational  section,  195;  housewives'  column  in, 
195;  cost  and  make-up  of,  196;  choice  of  title,  196;  use  of  illustrations, 
196;  selected  references  on,  198. 

Conduct,  in  connection  with  knowledge  and  impulse,  16;  in  relation  to  good- 
ness, 19. 

Conferences,  educational  use  of  group,  147,  239,  321,  337;  dinner,  150,  162; 
foremen's,  160,  164,  303;  salesmen,  182;  buyers,'  182;  with  labor  unions, 
239,  343,  430,  502;  on  discharge,  246;  on  job  specifications,  265,  268; 
objections  to,  337;  on  wages,  338,  340,  342,  359;  executives',  379; 
value  of  formal,  384;  with  experts,  456;  proposal  for  national,  500; 
on  production,  441. 

Co-operation,  among  executives,  162;  between  managers  and  workers,  268, 
406,  488,  493;  in  job  study,  268;  in  workmanship,  289,  470;  with  benefit 
associations,  363,  366,  372;  on  savings  funds,  371;  between  industry  and 
community,  482,  483;  on  prices,  487,  501;  between  industry  and  govern- 
ment, 505. 

Cooke,  M.  L.,  396  note. 

Corporation  school  training,  a  function  in  personnel  activity,  27;  types  of, 
141,  173;  for  executives,  143;  definition  of,  173. 

Cost  analysis,  as  applied  to  working  force,  26,  402;  of  poor  selection  of 
applicants,  86,  285,  of  installing  new  equipment,  111;  arousing  interest 
in  work  through  publishing  equipment,  209;  of  labor  turnover,  286; 
material  cost,  332,  402,  486. 

Craigmile,  Mr.  144  note. 


524  INDEX 

Creative  impulse,  14,  514;  effects  of  its  repression,  15;  effects  of  its  expansion, 
160;  esprit  de  corps  promoted  by  liberating,  161  note;  as  promoting 
interest  in  work,  218. 

Curiosity,  value  of,  16. 

Darlington,  Th.,  126  note,  129  note. 

John  David  Sons  &  Company,  "federal  plan"  of  417. 

Dennison  Mfg.  Co.,  rating  scale  for  foremen,  59;  conference  of  foremen  on 

rating  scale,  59. 
Dewey,  J.,  200  note. 
The  Dial,  on  sabotage,  220  note. 
Discharge,  Chap.  XVII,  236,  283,  423;  discipline  through,  240;  for  individual 

delinquencies,  243;  types  of  procedure  in,  245,  310;  causes  of,  246,  310, 

318;  restricting  "right  to,"  247;  arbitration  boards,  248,  423;  selected 

references  on,  249. 
Diseases,  occupational,  91;  nurse  responsible  for  records  of  occupational,  98; 

cleanliness  reducing,  130;  time  limit  on  jobs  causing,  227;  job  analysis 

eliminating  hazards  of,  259;  a  cause  of  separation,  283;  as  an  industrial 

risk,  361;  compensation  for,  363. 
Dispensary,  use  of  company,  89. 

Domestic  Engineering  Co.,  rating  scale  for  foremen,  59. 
Douglas,  P.  H.,  281  note. 
Dress  and  Waist  Industry,  agreement  on  limitation  of  overtime  work,  76 

note. 
Dunn  and  Bradstreet,  index  on  wage  data,  334. 

Eddy,  A.  J.,  487  note. 

Education,  its  place  in  industry,  17,  206,  320;  as  a  division  in  personnel 
work,  31;  duties  assigned  to  division  of,  33;  cooperation  with  industry, 
43,  181,  185,  311,  320,  483;  effect  of  fatigue  in,  71;  in  vacation  habits, 
77;  of  industrial  nurse,  97;  in  safety,  107;  in  sanitation  128;  in  leadership, 
135;  is  time  consuming,  138,  414,  435;  opportunities  offered  in,  138; 
of  minor  executives,  139;  use  of  group  conferences  in,  147;  public 
school,  171,  185;  general  work  in,  185,  207. 

Effort,  reducing,  7;  to  interest  employee  in  use  of  vacations,  77;  personal 
before  organized,  163. 

Emergency  Fleet  Corporation,  178  note;  plan  for  shipyard  training  of,  178, 
179  note',  required  qualifications  of  instructors,  178;  qualifications  of 
training  directors,  178;  scope  of  training  work  of,  178;  training  factors, 
179;  training  results,  179;  training  cost,  179. 

Emmet,  B.,  345  note. 

Employee,  introduction  of  new,  61 ,  309;  effect  of  follow-up  process  on, 
62;  his  need  of  regular  vacation,  77;  his  attitude  toward  rest  periods, 
81;  advantages  of  health  supervision  to,  85;  physical  examination 
of,  86,  263,  365;  committees  on  health  work,  94;  responsible  for  acci- 
dents,  103;  suggestion?  on  accident  prevention,  103;  safety  com- 
mittee, 106;  rotation  on  committees,  94,  106,  215;  air  space  required 
by,  117;  seats  for,  123;  toilets  for,  127;  shower  baths  for,  129; 
towels  for,  129,  130;  lockers  for,  131;  educational  opportunities 
for,  138, 181, 185,  206,  319,  408;  methods  of  training,  171,  230,  427;  value 


INDEX  525 

of  educational  trips  for,  183,  206;  americanizing  foreign-born,  185,  309; 
naturalization  of  foreign-born,  185;  contributing  to  company  magazine, 
191,  194;  effect  of  environment  on,  202,  319;  committees  on  production 
problems,  210,  211,  381;  rewards  to,  215,  317,  330,  347,  351,  370,  443, 
504;  recreational  opportunities,  271,  319,  440;  transfer  opportunities, 
229;  398;  "better  advantage  notice,"  232;  qualifications  of,  263,  264, 429; 
grading,  277,  470;  economic  beliefs  of,  311,  329;  insurance  for,  317,  318, 
365,  368,  371,  406,  441;  pensions  for,  317,  369;  loans  to,  318,  363; 
housing,  319,  354;  transportation,  319,  403;  use  of  labor  audit  to,  323; 
representation,  346,  351,  377,  379,  380,  381,  408,  413,  417,  424,  428,  435, 
439,  442,  444,  475,  492,  definition  of,  418;  leadership  among,  455. 

Employee  organizations,  302,  312,  354,  379,  380,  407,  453,  489,  Chap  XXX, 
438;  types  of,  410,  441;  plan  of,  410, 414, 418,  on  "federal plan,"  410,  422, 
445;  principles  underlying,  411;  administration  oversight  of,  414,  425, 
441;  workers'  interest  in,  414,  438;  right  to  vote  in,  418;  right  to  hold 
office  in,  418;  basis  of  representation  in,  419;  methods  of  election  to,  420; 
types  of  employee  representatives  in,  434;  shortcomings  of,  443,  456; 
as  educational  medium,  438,  440;  value  of,  438,  440,  445;  structure  of, 
439,  443;  committees  of,  439,  440,  441;  administration  of,  440;  grants  to, 
441,  442;  difference  between  labor  union  and,  441;  functions  of,  442; 
difference  between  company  union  and,  442. 

Employee's  handbook,  contents  of,  61,  239. 

Employers'  associations,  312;  Chap.  XXXIII,  481,  489,  502;  and  shop 
committees,  412;  and  collective  bargaining,  447;  legal  nature  of  trade 
union  contracts  with,  465;  influencing  personnel  administration,  481, 
483;  types  of,  481,  483,  484;  conventions  of,  484;  functions  of  national, 
484,  487;  educational  work  of,  485;  selected  references  on,  489. 

Employment,  as  a  division  in  personnel  work,  31;  duties  assigned  to  division 
of,  32;  worker's  necessity  of  continuity  of  employment,  45,  205,  396, 
403,  471;  standards  of,  53,  469;  introduction  procedure  to,  62;  follow- 
up  methods  in,  62;  value  of  follow-up  in,  63;  control  of  standards  of,  63; 
joint  negotiation  on  standards  of,  64,  493;  selected  references  on,  64; 
terms  of,  67,  265;  labor  turnover  and  length  of,  285;  and  women  and 
infant  mortality,  357  note;  causes  of  irregular,  397;  ill  effects  of  under — 
403. 

Employment  offices,  need  for  national  public,  44,  403;  how  to  build  up  a 
system  of  public,  45;  reduction  of  labor  turnover  effected  through  func- 
tionalized,  288. 

Engineer,  executive  scope  for,  26;  safety,  103,  105;  duties  of  safety,  106; 
cooperating  with  other  executives,  106;  each  worker  an  efficiency,  211. 

Erskine,  L.,  117  note,  129  note,  130  note. 

Everett,  W.  G.,  20  note. 

Examination,  physical,  86;  need  for,  87;  reasons  for  physical,  87;  objection 
of  organized  labor  to  physical,  87;  character  of  medical,  88;  value  of 
periodical  physical  re-,  89,  227. 

Executives,  responsibilities  of,  102,  116,  118,  121,  148,  162,  300,  390,  444; 
training,  Chap.  IX,  135,  143,  232;  qualities  of  successful,  136,  137; 
prerequisites  for  training,  138;  selected  for  training  courses,  139; 


526  INDEX 

coming  up  from  the  ranks,  139,  153;  sources  of  supply,  139,  140,  488; 
scientific  courses  for,  142,  144;  courses  for  training  employment,  143; 
laboratory  course  for  training,  146;  inspection  trips  for,  149,  159;  auxil- 
iary training  for,  150;  club  meetings  of,  150;  value  of  college  education 
for,  151;  selected  references  on  training,  151;  cooperation  among,  162, 
392;  understudying,  232,  390;  labor  auditor's  interviews  with,  300,  302; 
staff  conferences,  303,  379;  staff,  376;  their  place  in  employee  organiza- 
tions, 439,  443. 

Experts,  used  in  personnel  work,  4,  54,  109,  110,  124,  147,  155,  160,  168,  269, 
271,  457,  482;  foreman's  relation  to,  155,  156,  163,  166;  as  lecturers, 
183,  206,  484;  limitations  of,  211;  engaging  outside,  211,  483;  qualifica- 
tions of  job  analyst,  271;  qualifications  of  labor  auditor,  298;  character 
of  pay  adjuster,  353;  coordination  of,  374,  392. 

Factory,  197  note,  365  note. 

Factory,  state  inspection,  110,  307;  fool-proof  equipment,  115;  ventilation, 
heating,  humidity,  116,  117,  127;  lighting,  119,  127;  code  of  lighting, 
121  note;  noise  and  vibration,  121;  prevention  of  unnecessary  noise  and 
vibration  in,  122;  chairs  for  workers  in,  123;  provisions  of  employee 
rest  rooms,  124;  cleaning,  125,  294,  401;  cleaning  staff,  126;  cleaning 
methods,  126;  supply  of  drinking  water,  126,  127;  bubbler  fountains, 
127;  sanitary  equipment,  127;  dressing  rooms,  130;  exterior,  132; 
library,  161,  183;  experts,  163;  training,  171,  173,  182;  instructors,  174, 
176,  178;  news  section  of  company  magazine,  192;  records,  207,  261, 
291,  301,  390;  fellowship,  217;  labor  analysis,  Chap.  XXI,  291;  upkeep, 
349;  organization,  442;  use  of  detectives  by,  453,  482. 

Family,  love  of,  14;  "the  average,"  341;  theory  of  "the  family  wage," 
357. 

Fatigue,  and  education,  71;  elimination  of,  72,  92,  123;  consequences  of, 
76,  92;  study,  91;  definition  of,  91;  as  a  physiological  problem,  92,  126; 
methods  for  discovering,  92,  257;  reduction  of  excessive,  92,  218; 
selected  references  on,  99;  foreman's,  154. 

Favill,  84  note. 

Federal  Board  for  Vocational  Education,  training  the  disabled,  184. 

Federal  Trade  Commission,  a  source  of  wage  data,  335. 

Ferguson,  C.,  135  note. 

Win.  Filene  Sons  Company,  employees'  association  of,  411. 

Finance,  problem  of,  315,  385;  policy  and  wage  determination,  333,  337,  341, 
347;  determination  of  policies  in.  :JS~>;  need  of  publicity  in,  385,  :;s7; 
relation  to  personnel  issues,  387;  389;  methods  of,  402. 

Fire,  inspection,  112;  exits.  112;  drills,  1 13;  apparatus,  113. 

First  aid,  kits.  1  ].*i;  MilininisterinK,  11 6;  room,  116,  131,  132. 

Fitch,  J.  A.,  248  note,  369,  370  note. 

Fleming,  A.  P.  M.T  181  note. 

Flies,  elimination  of,  130. 

Florence,  P.  S.,  92  note,  257  note. 

"Flying  squadron,"  course  of,  II  t;  training  for  promotion,  232;  value  of  in 
regularizing  employment,  M 

Follow-up,  of  new  employee,  62,  175,  228;  n  task  of  interviewer.  »'.2;  co- 


INDEX  527 

operation  in,  63;  its  value  in  transfer  and  promotion  63;  medical,  85; 
86;  clinical,  86. 

Ford  Motor  Company,  reintegration  of  ex-convicts  by,  46. 

Foreman,  as  personal  link,  25;  his  requisitions  for  help,  51;  rating  scale  for, 
59,  158;,  166  note;  effect  of  long  hours  on,  68,  154;  need  of  periodic 
holidays  for,  75,  253;  responsible  for  accidents,  102,  106;  committee  on 
accidents,  103;  in  charge  of  departmental  safety  committee,  106; 
cooperation  with  safety  engineer,  106;  education  of,  139,  144,  145,  158, 
187  note,  215,  221  note,  232,  358;  shift,  144;  department,  144,  157,  167; 
his  important  position,  153,  155,  359,  380;  worker's  estimate  of,  153; 
psychology  of ,  153,  237;  restricted  standard  of  value,  154;  function  of, 
156,  166,241;  qualifications  of ,  157,  167;  understudies  for,  157,  158,  232; 
curriculum  of  classes  for,  160;  council,  161,  163,  165,  303,  359,  380; 
club,  161,  302;  his  relation  to  other  executives,  163,  166,  167,  228,  296, 
378;  studying  factory  records,  164,  207;  his  place  in  employee  organiza- 
tions, 165,  410,  439,  443;  as  management  delegate,  166,  482;  his  pay,  166, 
358;  his  editorials  in  company  magazine,  194;  bonus  to,  209,  215,  359; 
his  power  of  dismissal,  245,  310;  his  connection  with  the  job,  263, 
297;  and  labor  turnover,  284,  286,  308;  representation,  377,  379,  381, 
410;  classes  for,  483. 

Foremanship,  need  of  competent,  26;  use  of  special  tests  in,  56,  158;  the 
problem  of,  Chap.  XII,  153,  167,  359;  changing  character  of,  155,  160; 
functional,  155,  167;  analysis  of,  156,  166;  instruction  in,  158,  159,  187 
note;  selected  references  on,  169. 

Framingham  (Mass.)  Community  health  and  tuberculosis  demonstration, 
committee  report  on,  95. 

Friction,  machinery  for  reducing,  7;  output  affected  by  reducing,  69. 

Gantt,  H.  L.,  26  note,  223  note,  401  note,  514  note. 

Garner  Print  Works  &  Bleachery,  on  unemployment  benefit  fund,  368  note. 

Garton  Foundation  Memorandum,  on  significance  of  workers'  and  employers' 

organizations,  489  note;  on  the  building  trades,  498  note. 
Garvey,  J.  J.,  180  note,  182  note. 
General  Electric  Company,  apprentice  school,  181;  apprentice  promotion, 

181;  shop  committee  plan  of,  410. 
Gilbreth,  F.  B.,  124  note,  257  note,  261. 
Gladstone,  W.  E.,  5. 
Goodness,  love,  of,  19. 

Goodrich  Company,  B.  F.,  text-book  on  rubber,  207  note. 
Goodwill,  basis  of,  18,  450;  source  of,  26;  character  of,  409,  429. 
Goodyear  Tire  and  Rubber  Company,  training  courses  for  executives  given 

by,  144;  "Production  Flying  Squadron"  course,  144. 
Great   Britain,  industrial  fatigue  research  board,  116,  note;  Whitley  report 

of  industrial  council  plan  of,  412  note,  493  note;  report  on  joint  standing 

industrial  councils,  492;  ministry  of  labor  organizing  industrial  councils, 

494;  industrial  councils  in  civil  service,  510. 
Greenfield  Tap  &  Die  Corporation,  talking  finance  to  employees,  388,  434 

note. 


528  INDEX 

Gregg,  R.  B.,  286,  305. 

Grievances,  Chap.  XVII,  236,  245,  340;  use  of  shop  committee  on,  239,  310; 

definition  of,  244;  treatment  of,  244,  310,  421,  428,  452,  472;  agencies 

handling,  244,  451 ;  selected  references  on,  249. 
Grieves,  W.  A.,  429  note. 

Harris,  G.,  184  note. 

Hart  Schaffner  &   Marx,  on  value  of  employee  representation,   427  note. 

Harvard  Medical  School,  department  of  industrial  hygiene,  95. 

Harvester  Industrial  Council,  on  shop  committee  plan,  409  note,  418  note. 

Health,  and  safety,  as  a  division  of  personnel  work,  31,  84;  duties  assigned 
to  division  of,  32;  relation  of  hours  and  working  periods  to,  69;  of  the 
worker,  Chap.  VIII,  84,  127;  program,  86;  output  and,  89;  records,  90; 
education,  90,  195;  content  of  health  talks,  90;  periodic  use  of  health 
talks,  90;  cooperation  between  industry  and  local  agencies  of,  95;  State 
health  insurance,  95,  367;  selected  references  on,  99;  equipment,  131. 

Health  work,  field  of  industrial,  84;  beneficial  results  of  preventive,  85,  319; 
cooperation  in,  86,  87,  94;  96,  195,  367;  joint  responsibility  for,  87; 
committees  on,  94;  problems  for  study  of  committees  on,  94;  ad- 
ministration of,  97;  affiliated  to  personnel  activities,  98. 

Hill,  L.,  116,  note. 

Hobson,  J.  A.,  23,  24  note. 

Holidays,  Saturday  a  half-,  71,  75,  value  of  half-,  71;  observing  public,  75; 
as  rewards,  240;  policy  of  regular,  243. 

Hookstadt,  C.,  362  note. 

Hoopingarner,  D.  L.,  288. 

Hospital,  use  of  company,  89;  separate  wards  or  buildings,  90;  cooperation 
with  existing  local,  90. 

Hours,  and  working  periods,  Chap.  VII,  67;  their  effect  on  worker,  68;  a 
problem  for  joint  action,  68,  472;  value  of  their  reasonable  limitation,  68, 
428;  per  day,  68,  71;  their  effect  on  output,  69;  relation  to  payment,  71; 
per  week,  71 ;  arguments  for  reduction  of,  72, 214;  length  of,  77;  noon,  78; 
physiological  factors  concerning,  74,  75,  78,  80;  for  women  and  children, 
82;  selected  references  on,  83. 

Hoxie,  R.  F.f  326  note. 

Human  well-being,  regard  for,  12,  515;  elements  of,  12. 

Human  nature,  characteristics  unchanging,  12;  similarity  of,  13;  as  the 
unifying  factor,  19;  insight  into,  136. 

Huntington,  E.,  118  note,  273  note. 

Illuminating  Engineering  Society,  table  of  lighting  adopted  by,  119. 

Individual  bargain,  assumptions  of,  448,  475;  an  impossible  burden  of  re- 
sponsibility to  management,  450;  value  of,  459. 

Industrial  government,  442;  purpose  of,  Chap.  XXXV,  512;  comparison 
with  political,  512. 

Industrial  health  and  efficiency,  72  note,  74  note,  75  note,  78  note,  93  note. 

Industrial  Management,  on  profit  sharing,  345  note;  on  group  insurance,  366 
note;  on  industrial  relations,  410  note;  on  industrial  democracy,  427  note. 

Industrial  risks,  Chap.  XXV,  361,  397;  types  of,  361-371;  principles  in 
writing,  362;  a  sinking  fund  for  meeting,  368,  406;  selected  references 
on,  372. 


INDEX  529 

Industrial  Welfare  Commission  of  California,  sanitary  standards  required 
by,  128  note. 

Industry,  human  values  in,  Chap.  II,  12,  514;  personality  in,  21,  513,  516; 
purpose  of,  21,  222,  512;  selected  references  on  human  values  in,  22; 
relation  to  public  school  education,  171,  185,  311;  educational  coopera- 
tion between  other  lines  of  work  and,  180,  181;  causes  of  separations  in, 
282,  283,  287,  403;  group  insurance  in,  317,  318;  wages  in  the,  333; 
capital  and,  389,  498,  515;  administration  of,  392,  393,  513;  seasonal 
fluctuations  in,  403;  coping  with  depressions,  403;  organizing  demand, 
404,  486,  506;  democracy  in,  432,  444,  509,  514,  516;  cooperation  in, 
485,  500;  competition  in,  486,  494;  control  of,  498;  boards  of  conciliation 
and  arbitration,  500;  politics  in,  509,  510;  as  public  service,  444,  514, 
515;  representative  control  in,  516. 

Insurance,  method  of,  361,  363;  plans,  362,  364,  372;  administration  of,  362; 
accident,  362;  sickness,  363;  benefit  amounts,  364,  367,  371,  441; 
characteristics  of  group,  365,  371;  cost  of  group  life,  365;  public  health, 
366;  unemployment,  367;  public  unemployment,  369;  old  age  pensions, 
369,  372;  savings  funds,  371;  life,  371;  need  of  public,  372;  selected 
references  on,  373. 

Interborough  Rapid  Transit  Company,  employees'  association  of,  411. 

Interest,  in  work,  Chap.  XV,  199,  348,  480;  elements  of,  200,  204;  worker's 
attitude  toward,  202,  226,  386,  458,  471;  lack  of,  203,  279,  344  note; 
arousing,  204,  230,  268,  279,  396,  408;  types  of  derived,  217,  218,  350; 
under  soviet  control,  221;  and  efficiency,  224,  271,  428;  selected  refer- 
ences on,  224;  consent  and,  271;  on  stock  shares,  351;  solidarity  of 
workers',  462. 

International  Harvester  Company,  apprentice  school,  181;  on  industrial 
relations,  223;  on  foremen's  salaries,  358;  shop  committee  plan  of,  410, 
426;  increase  in  efficiency,  428  note;  type  of  employee  representatives, 
434. 

International  joint  conference  council  for  printing  industry,  500;  scope  of, 
501. 

Interview,  booths  for  private,  52;  treatment  of  applicant  in,  52;  technical, 
57;  with  leavers,  285. 

Interviewer,  selection  and  character  of  preliminary,  50;  character  of  final,  50; 
written  job  specifications  available  to,  50,  264;  follow-up  of  new  em- 
ployee by,  62;  foreman  as,  159. 

Interviewing  blanks,  description  of,  53. 

Introduction,  of  worker  to  plant,  61,  308;  manner  of,  61,  309;  content  of 
handbook  given  at,  61;  duty  of  special  messenger  of,  61;  of  worker  to 
foreman  and  fellow-workers,  62;  of  additional  machinery,  214. 

James,  W.,  200. 

Jenkinson,  W.  M.,  209  note. 

Job  analysis,  Chap.  XVIII,  251,  390,  471;  use  of,  7,  164  note,  229,  257,  267, 
272,  278,  308;  as  reducing  fatigue,  93,  257;  of  foreman's  position,  156, 
157;  of  intellectual  content  of  job,  202;  determining  terms  of  work,  211; 
determining  a  "fair  day's  work,"  251,  254,  269;  need  of,  252;  definition 
of,  255,  267;  purpose  of,  256,  485;  time  study  technique  in,  256,  261, 


530  INDEX 

272,  275;  value  to  employers,  256,  278,  473;  value  to  workers,  258,  474; 

value  to  public  and  consumer;  259,  278;  content  of,  260,  279,  308,  334; 

concerning  the  job  in,  261,  272;  committee  on,  265,  270;  272,  278,  339, 

342,  421;  supervision  and  control  of,  Chap.  XIX,  266,  270;  the  task  of 

the  job  analyst,  271;  importance  of  writing  out,  271,  390;  principles 

governing  use  of,  277;  in  civil  service,  278;  selected  references  on,  280. 
Job  instruction,  types  of,  173,  180;  general  problems  of  procedure  for,  174; 

results  of,  175,  207;  for  shipyard  workers,  177,  180;  need  of,  309;  and 

wages,  332. 
Job  specifications,  Chap.  XVIII,  251;  used  in  selection  50,  308;  functions 

of,  51,  229;  need  of,  229;  based  on  job  analysis,  257;  form  of,  264; selected 

references  on,  280. 
Johnson,  A.,  219  note. 
Jones,  E.  D.,  137  note,  275  note,  327  note. 
Jones,  M.  M.,  166  note. 
Justice,  desire  for,  18;  as  applied  to  industrial  problem,  IS;  group  conception 

of,  451;  joint  dealings  create  sense  of,  451. 

Kent,  W.,  117  note. 

Labor  audit,  methods  of,  Chap.  XXI,  291,  299;  definition  of,  291,  323; 
purpose  of,  291,  321,  325;  prerequisites  to  making,  295;  attitude  of 
consultant  on,  295,  299,  324;  conferring  with  employees  on,  297; 
qualifications  of  consultant  on,  298;  information  supplied  by  employee 
organizations,  298;  educational  process  of,  297,  300,  322;  available 
records  for,  301;  selected  references  on,  303;  check-list,  Chap.  XXII, 
304;  contents  of,  305;  technique  of,  320;  its  use  to  the  community,  324, 
326;  results  of,  325. 

Labor,  problem  of,  in  relation  to  government  ownership,  8;  division  of,  23, 
357;  turnover  as  reason  for  a  personnel  department,  25,  285;  turnover 
and  health  supervision,  85;  turnover  and  working  conditions,  111,  403; 
turnover  and  training,  171,  175;  laws  interpreted  by  company  magazine, 
195;  conflict  of  capital  and,  219,  282,  497;  turnover  records,  263,  301; 
turnover,  measurement  of,  Chap.  XX,  281,  284,  307;  turnover  defined, 
281,  289;  turnover  computed  on  basis  of  separations,  282;  turnover 
formula;,  283,  288;  turnover  cost,  285,  308;  remedies  for  turnover  of, 
287;  turnover,  selected  references  on,  289;  legislation,  313,  481;  law 
administration,  313;  "solidarity"  manifested  in  the  general  strike, 
464;  consultant,  functions  of,  488. 

l.;il>or  supply,  sources  of,  Chap.  V,  41,  308;  cultivating  sources  of,  42,  48, 
405;  possible  sources  of,  42;  further  sources  of,  46;  penal  institutions  as 
sources  of,  46;  limits  upon  sources  of,  46;  educational  institutions  as 
sources  of,  43,  47;  factory  as  source  of,  42,  48,  139;  selected  references 
on  sources  of,  48. 

I. ark  in.  J.  ( ;.,  433  note. 

League  for  Industrial  Rights,  object  of,  489. 

Leiserson,  W.  M.,  417  note. 

Leitch,  J.,  211  note,  427  note,  442  note,  444. 

Leverhulme,  Lord,  72  note. 

Life  Extension  Institute,  limit h  r<liir:iti<>n:»l  work 


INDEX  531 

Link,  H.  C.,  23  note,  51,  52  note,  57  note,  58  note,  174  note. 
Lunch,  periods,  78,  93;  rooms,  93;  125;  travelling  carts,  94. 

Macaulay,  Lord,  434  note. 

McCormick,  Cyrus,  Jr.,  412,  427,  434  note. 

Mackenzie — King,  W.  L.,  469  note. 

Management,  corporate  form  of,  24,  392,  509;  weakness  of  absentee,  24; 
its  conception  as  a  profession,  70;  need  of  periodic  holidays  for  members 
of  the,  75;  its  opposition  to  medical  oversight,  85;  its  responsibility 
for  accidents,  102;  leadership  in,  135,  390,  411;  defining  art  of,  137; 
its  economic  beliefs,  311,  327,  334,  337,  346,  368,  442,  446,  469,  477; 
provision  for  administering  labor  law,  314;  form  and  efficiency  of,  314, 
395;  coordination  of,  315,  374,  392;  use  of  labor  audit  to,  321;  scientific, 
383;  records,  390,  sharing,  416,  434;  represented  on  shop  committees, 
420;  the  "open  door"  theory  in,  452,  violations  of  agreements  by,  464, 
502;  attitude  toward  personnel  administration,  488;  grants  to  employee 
associations,  441,  442. 

Manhattan  Trade  School  for  Girls,  course  of  study,  172  note. 

Massachusetts,  Board  of  Education,  Americanization  plan  of,  185;  employ- 
ment insurance,  369  note. 

Medicine,  definition  of  industrial,  84;  training  doctors  in  industrial,  95. 

Melbourne  Argus,  on  limitation  of  output,  252  note. 

Midvale  Steel  Company,  shop  committee  plan  of,  410. 

Mill,  John  Stuart,  83,  203  note,  237  note,  241  note,  391  note,  394,  413,  414, 

416  note,  435  note,  438  note,  449  note,  457  note. 

Monotony,  in  work,  24,  101,  200,  202;  relief  from,  214;  and  labor  turnover 

287. 

Montgomery,  Ward  Company,  committee  system  of,  147. 
Morse  Dry- Dock  &  Repair  Company,  employees'  association  plan  of,  411. 
Miinsterberg,  H.,  57  note. 

The  Nation  (Engl.),  on  assuming  responsibility,  434  note. 

National  Adjustment  Commission,   reconstitution  of,   505;  constituting  a 

general  dock  council,  505;  functions  of  general  dock  council,  505. 
National  Aid  to  Vocational  Education,  on  vocational  education,  170  note. 
National  Association  of  Corporation  Schools,  publications  by,   141,  note, 

182  note. 
National  Association  of  Employment  Managers,  on  industrial  democracy, 

417  note;  on  shop  committees,  426  note,  428  note,  429  note;  on  committee 
classifications,  433  note;  on  type  of  employee  representatives,  434  note. 

National  Association  for  the  Study  and  Prevention  of  Tuberculosis,  health 
educational  work,  95. 

National  Board  For  Jurisdictional  Awards  in  the  Building  Trades,  composi- 
tion of,  503;  rules  of,  504. 

National  Board  of  Labor  Managers,  composition  of  in  men's  clothing  in- 
dustry, 503. 

National  Civic  Federation,  as  contact  between  "capital  and  labor,"490. 

National  Consumers'  League,  briefs  on  employment  terms  and  conditions, 
259. 

National  Harbor  Industrial  Council,  object  of,  506. 


532  INDEX 

National  industrial  councils,  place  of,  405,  472,  474,  498,  506;  definition  of, 
Chap.  XXXIV,  492,  495;  English  types  of,  492;  functions  of,  493, 
506,  507;  reasons  for,  494;  joint  representation  on,  496,  497,  507; 
limitation  of  idea  of,  497;  American  types  of,  499,  503,  504;  voting  in, 
506;  objections  to,  507;  work  of,  508;  their  place  in  civil  service,  510; 
selected  references  on,  510. 

National  Industrial  Conference  Board,  study  on  rest  periods,  79  note;  on 
wartime  employment  of  women,  176  note;  object  of,  490. 

National  Industrial  Federation  of  Clothing  Manufacturers,  in  men's  cloth- 
ing industry,  503. 

National  Manufacturers'  Association,  object  of,  489. 

National  Mental  Hygiene  Association,  health  educational  work,  95. 

National  Tube  Co.,  personal  safety  talks,  105. 

National  Safety  Council,  publication  of,  115  note;  principles  and  practice  of 
safety,  115  note,  119  note,  120  note. 

New  Republic,  on  the  laborer's  turn,  219  note;  on  communistic  experiments, 
221  note;  on  labor  and  the  new  social  order,  222  note;  on  shop  committees, 
346  note. 

New  York  State  Industrial  Commission,  industrial  code,  112  note. 

New  York  Times,  on  proposal  of  railroad  brotherhoods,  389  note;  on  dis- 
crimination against  non-citizens,  419  note;  on  committee  classifications, 
433  note. 

North  Western  Railroad,  employee  suggestions  on  safety  work,  104. 

Nurse,  company,  90,  97;  cooperation  in  employing,  96,  482;  supporting 
community  district,  96;  character  of  industrial,  97;  duties  of  industrial, 
97,  98,  116,  242;  various  records  kept  by,  98,  241;  as  member  of  visiting 
committee,  365. 

Output,  maintaining  the,  69,  269,  399;  effect  of  rest  periods  on,  80;  fatigue 
and,  91;  and  physical  working  conditions,  116;  and  humidity,  118  note, 
401;  stimulated  by  educational  trips,  184;  stimulated  by  individual  pro- 
duction records,  208;  control  of,  219,  251,  311,  401,  498;  standards  of, 
262;  amounts  of,  262,  269,  273,  331;  quality  of,  275,  332;  restrictions  on, 
344  note,  388,  476;  494. 

Ownership,  desire  to  possess,  16,  350;  satisfaction  in,  16;  judgment  on  passive, 
18;  of  industry,  219,  222,  498;  of  distribution,  220;  of  stock,  360; 
government,  499;  public,  515. 

Packard  Automobile  Company,  vestibule  school  of,  176;  conclusions  on 
employee  training  reached  by,  177;  apprentice  school,  181. 

Pan  American  Scientific  Congress,  proceedings  of  Second,  on  public  schools 
and  industry,  171  note;  on  cost  of  employee  training,  176  note. 

Park,  R.  I !..  194  note. 

Payment  plans  and  methods,  Chap.  XXIV,  345,  459;  methods,  316,  345, 
352,  398,  487;  profit  sharing  plans,  345,  359,  387;  definition  of  profit 
sharing,  345  note;  stock  purchase  plans,  350,  359;  payment  policies,  354, 
387;  the  meaning  of  "equal  pay,"  355;  selected  references  on,  360. 

Payne,  F.  H.,  388  note. 

Pearce,  J.  G.,  181    note. 

Pennsylvania  Railroad  Company,  apprentice  ftchool,  181. 


INDEX  533 

Personality,  definition  of,  20;  as  end  of  moral  effort,  20;  in  industry,  21,  514, 
516;  value  of,  513. 

Personnel  administration,  field  of,  Chap.  I,  1;  definition  of,  2;  synonyms  for, 
2;  as  managerial  function,  3,  324;  direction  of  people  in,  5,  238,  254, 
414,  454;  permanent  problem  of,  7,  324;  principles  of,  8;  applied  to  civil 
service,  8;  professional  standard  of,  10;  selected  references  on  historical 
setting  for  specialized,  23;  recent  growth  of  functional  management  in, 
26,  245;  division  of  work  of,  11,  31,  36;  use  of  company  magazine  in, 
190;  and  shop  committees,  414;  lack  of  standards  in,  513. 

Personnel  department,  reasons  for,  Chap.  Ill,  23,  295;  recent  growth  in 
functions  of,  27,  244,  452;  economic  grounds  for,  28;  psychological 
grounds  for,  28;  selected  references  on,  28;  functions  of,  Chap.  IV,  30, 
110,  267;  relations  to  local  and  national  organizations  and  movements, 
35;  functional  chart  of,  36;  authority  chart  of  37;  location  of  waiting 
room  of,  52;  maintaining  a  vacation  bureau  in,  77;  medical  service 
affiliated  to,  98;  visits  to,  149  note;  foreman's  relation  to,  158,  162,  241; 
as  supplanting  the  foreman,  245;  procedure  in,  398. 

Personnel  manager,  synonyms  for,  2;  standing  of,  3;  point  of  view  of,  4; 
109,  395;  his  responsibility  for  various  functions;  30,  191,  254,  379,  441; 
his  final  authority  in  selection  and  discharge,  61;  his  leadership;  161,  228, 
245,  296,  385,  426,  441;  use  of  labor  audit  to,  322;  his  place  in  shop 
committee  422;  his  attitude  toward  employee  psychology,  447. 

Personnel  policies,  motives  in,  9;  attitude  of  managers  toward,  27;  coordina- 
tion of,  35,  315,  374;  on  time  factors,  67,  70;  on  vacations,  76;  on  lunch 
periods,  78;  on  rest  periods,  80;  medical,  90;  on  safety-first,  102,  107; 
on  personal  hygiene,  128;  on  advancing  executives,  139,  157;  personnel 
committee  on,  165,  378;  on  transfer  and  promotion,  226,  228;  job 
analysis  a  part  of,  254,  267;  influence  of  labor  audit  on,  294,  325; 
influence  of  court  decisions  on,  313;  on  payment  methods,  316,  346,  354; 
on  unemployment  compensation,  368;  on  pensions,  369;  determination 
of,  378;  transmission  of,  380;  on  training,  398. 

Personnel,  well-being  of,  7,  78,  406,  definition  of,  315;  experts  collecting 
personnel  records,  484. 

Physician,  need  of  women,  87;  duty  of  company,  88,  89,  128;  on  full  time 
service,  90,  97;  in  charge  of  physical  examinations  of  employees,  88; 
training  industrial,  95;  cooperation  in  employing,  96,  482;  on  call  only, 
97;  attitude  of  factory,  97. 

Physiology,  its  use  in  judging  conduct,  5;  and  sanitation,  129. 

Pilkington,  R.  G.,  216  note. 

Placement,  methods  of  selection  and,  Chap.  VI,  49;  social  importance  of 
standards  of,  63;  selected  references  on,  64;  of  handicapped  applicants, 
88. 

Polakov,  W.  N.,  69  note. 

Premiums,  placed  upon  uneducated  worker,  23,  476;  course  in  figuring,  177; 
unpopularity  of,  459. 

Printz-Biederman  Company,  "federal  plan"  of,  411. 

Production,  records,  use  of,  207,  210,  231,  263,  484;  types  of  records  of,  208, 
210;  effect  of  publishing  individual  records  of,  208;  standard  perform- 
ance as  basis  of  comparisons  in,  282;  importance  of  efficient,  314; 


534  INDEX 

unemployment  caused  by  changes  in,  340;  determination  of  policy 
concerning,  381,  399;  committee  on,  381;  causes  of  irregular,  397; 
methods  of,  400;  dovetailing,  401 ;  stimulating,  428. 

Productivity,  criterion  of,  6;  importance  of  high,  6,  494;  its  relation  to  a 
known  demand,  6,  404, 486;  length  of  working  period  and,  69;  in  relation 
to  increased  supervision,  167;  depends  on  human  factor,  170,  397; 
conditional  upon  interest  in  work,  223;  and  job  analysis,  258;  develop- 
ing, 471. 

Profit,  definition  of,  11  note;  distribution  of,  329;  basis  of  sharing,  328,  330, 
347;  determining  wage  rates,  327,  333;  unrestricted,  344  note;  division  of, 
346,  348,  350  note,  359;  principles  of  "sound"  division  of,  348;  claim  of 
capital  on,  349;  selected  references  on  sharing,  360;  worker's  attitude 
concerning  facts  about,  386. 

Progress  cards,  description  of,  60;  used  in  selection  procedure,  60,  231; 
yearly  earnings  listed  on,  353. 

Promotion,  arousing  interest  in  work  through,  213;  definition  of,  226; 
reasons  for,  228;  from  within,  228,  233;  prerequisites  of,  228;  methods  of, 
230,  310;  policies,  230;  "on  and  out,"  233;  limits  to,  233;  based  on  senior- 
ity, 234;  selected  references  on,  234;  a  matter  for  joint  control,  473. 

Psychology,  its  use  in  directing  people,  5,  217;  study  of,  25;  of  foreman,  153; 
of  fear,  361;  and  insurance  plans,  366;  and  employee  associations,  440. 

Rating  scale,  58;  description  of  officer's,  58;  its  value  for  promoting  execu- 
tives in  industry,  58,  231;  its  use  for  foremen,  59,  158;  requirements  to 
be  met  by,  59;  used  in  comparing  ability,  139. 

Ileferences,  selected,  on  chapter  topics,  11,  22,  23,  28,  39,  48,  64,  83,  99,  107, 
133,  151,  169,  187,  198,  224,  234,  249,  280,  289,  303,  360,  372,  373, 
395,  406,  436,  480,  489;  employees'  60. 

Reilly,  P.  J.,  58  note. 

Requisitions  for  help,  51 ;  advance  notice  for,  52. 

Research,  as  a  division  of  personnel  work,  31;  scope  of,  31;  duties  assigned 
to  division  of,  34. 

Rest  periods,  introduction  of,  78;  purpose  of,  79;  for  industrial  workers,  79 
note;  length  and  distribution  of,  80,  81;  use  of,  80;  adjusted  to  wage 
rates,  81;  employee  objections  to,  81;  for  women,  82. 

Rest  rooms,  for  employees,  123;  location  and  equipment  of,  124;  use  of,  124; 
joint  responsibility  for  installing,  124. 

Rice,  E.  E.,  366  note. 

Rockefeller,  J.  D.,  Jr.,  411  note,  514,  515  note. 

Safety,  first  movement  a  function  in  personnel  activity,  27;  as  a  division  of 
personnel  work,  31,  102,  105;  scope  of,  31;  program.  Chap.  IX,  101, 107; 
rule  book,  103;  publicity,  104,  195;  rallies,  104;  films,  105;  organizing 
shop,  105;  committees  on,  106;  cooperation  in,  107;  selected  reference^ 
on,  107. 

Sate,  problem  of,  315,  384,  485;  determination  of  sales  policy,  384,  399; 
methods,  384,  398;  regularizing,  399;  bonus  on,  399;  advertising  cam- 
paign in,  400;  dovetailing,  400;  affected  by  financial  methods,  401. 

Santa  F6  Railroad  Company,  apprentice  school,  181. 

Schneider,  H.,  264  noU. 


INDEX  535 

Science,  development  of  administrative,  25;  as  applied  to  industrial  relations, 
26;  as  applied  to  management  problems,  70. 

The  Scott  Co.,  on  interest  in  work,  201  note. 

"Scouting,"  practice  of  labor,  41;  practice  of  executive,  47. 

Seamen's  Journal,  on  proposed  industrial  council  for  marine  trades,    504. 

Selby,  C.  D.,  84  note,  89  note. 

Selden,  F.  H.,  201  note. 

Selection,  a  function  in  personnel  activity,  27;  methods  of,  Chap.  VI,  49, 
205,  308;  first  step  in  standardizing,  49;  final  authority  in,  60;  social 
importance  of  standards  in,  63;  selected  references  on,  64;  of  industrial 
leaders,  136;  of  executives  for  training  courses,  139;  of  foreman,  157; 
basis  of,  460. 

Selector,  sex  of,  50. 

Service,  as  a  division  of  personnel  work,  31;  definition  of,  31;  duties  assigned 
to  division  of  ,  34;  dental,  89;  cooperative  medical,  96;  equipment  and 
cost  of  medical,  98;  responsibility  for  medical,  98;  purpose  of  industrial 
medical,  98;  appeals  to,  222;  types  of  company  purchasing,  318;  "ser- 
vice features,"  a  function  of  employee  organizations,  440;  441. 

Service  worker,  duties  of,  3;  standing  of,  3. 

Shop  committee,  a  function  in  personnel  activity,  27,  436,  502;  relation  of 
foreman  to,  165,  410;  as  an  educational  medium,  183,  388,  408,  426,  436; 
its  action  on  production  problems,  210,  428;  on  shop  control,  239,  240; 
on  grievances,  244;  on  job  analysis,  267,  270,  479;  objections  to,  270, 
433,  438;  on  wages,  337,  338  note,  479;  function  of  central,  342,  419; 
coordinating  with  planning  department,  382;  principles  of  organization, 
Chap.  XXVIII,  407,  415;  reasons  for,  407,  454;  attitude  of  employers 
toward,  408,  412,  431,  479;  value  of,  410,  427,  429,  441;  plans  of,  410, 
418,  424,  479;  methods  of  organization,  Chap.  XXIX,  418;  composition 
of,  421,  425,  439;  meetings,  421,  425;  voting  on,  422,  423;  referendum, 
423;  use  of  arbitration,  423;  technique  of,  424,  439;  benefits  derived 
from,  426;  shortcomings  of,  430,  454;  selected  references  on,  436. 

Shop  rules,  Chap.  XVII,  236,  238;  a  problem  in  discipline,  237,  310;  develop- 
ment of,  238;  character  of,  239;  enforcement  of,  239;  penalties  for  break- 
ing, 240;  objective  of,  249;  selected  references  on>  249. 

Slichter,  S.  H.,  159  note,  219  note,  281  note,  399  note,  400  note. 

Southern  Pacific  Company,  laboratory  method  of  training  executives,  146. 

Sparkes,  M.,  344  note. 

Spence,  P.,  113  note. 

Staff  departments,  coordination  of,  Chap.  XXVI,  374,  384;  principles 
underlying  coordination  of,  374;  383;  board  of  personnel  directors,  379, 
381;  conditions  of  coordination,  383;  over-organization  of,  382,  384; 
adequate  coordination,  389;  selected  referenes  on  coordination  of,  395. 

Stanbrough,  D.  G.,  177  note. 

Standard  Oil  Company  of  New  Jersey,  on  committee  classification,  433. 

State  Boards  of  Health,  health  educational  work,  95. 

Stoddard,  W.  L.,  413  note. 

Strike,  character  of,  282,  461,  463;  labor  turnover:  a,  282;  use  of  labor 
audit  in  preventing  a,  325;  effects  of,  337,  494;  company  finances  and, 
386;  effect  of  employee  representation  on  frequency  of,  428;  benefits, 


536  IN      X 

431,  460;  use  of  sympathetic,  462,  475;  causes  of,  462;  purpose  of,  462, 

463,  466;  prevention  of,  481. 
Suggestions,  boxes,  103,  216;  awards  for,  104,  195,  215;  by  foreman  on  safety 

campaign,   106;  systems,  educational  value  of,   184,  310;  production 

value  of,  212;  use  of  systems  of,  215;  employee's  royalty  contract  on,  216; 

protecting  employee's,  493,  501. 
The  Survey,  on  surplus  profits,  346  note;  on  pensions,  370  note;  on  shop 

committees,  413  note;  on  printing  trade  international  council  project, 

502  note;  on  joint  industrial  councils  in  building  trades,  504  note;  on 

industrial  unrest,  515  note. 

Sweden,  Board  of  Industrial  Schools,  proposing  apprentice  training,  186  note. 
System,  R.  B.  Wolf  on  esprit  de  corps,  161  note. 

Taft,  W.  H.,  479. 

Tardiness,  reduction  of,  241;  cause  of,  242;  and  wages,  332. 

Taylor,  F.  W.,  137  note,  256,  275. 

The  Taylor  System,  its  proposed  use  by  soviet  government,  221 ;  in  Franklin 
Management,  329  note. 

Tead,  O.,  14  note,  346  note,  405  note,  442  note,  494  note,  507  note. 

Tead  &  Gregg,  on  job  analysis,  261  note. 

Technical  Association  of  the  Pulp  and  Paper  Industry,  R.  B.  Wolf's  address, 
208  note. 

Tests,  special,  53,  308;  should  be  devised  and  revised  by  experts  only,  54 ; 
use  of  the  results  of,  54,  56,  57,  158;  intelligence,  55,  231;  limits  of 
intelligence,  55;  trade,  56;  definition  of  trade,  56;  picture,  56;  perform- 
ance, 56;  oral  trade,  57;  special  abilities,  57;  selected  references  on,  65. 

Tewksbury,  W.  J.,  365  note. 

"Three-Position  Plan,"  231. 

Times  Annalist  Index,  on  wage  data,  334. 

Toqueville,  A.  de,  393,  394  note. 

Trade,  skill,  classification  of,  56,  470;  knowledge  analysed  and  classified, 
141,  180;  name,  400;  research  work,  485. 

Trade  union,  a  source  of  labor  supply,  43,  465;  on  setting  employment 
standards,  64,  368;  regulating  length  of  working  periods,  69;  and  fore- 
men, 165  note;  opposed  to  differential  pay,  273,  343,  459;  relation  of  the 
industry  to,  313,  343,  465,  471,  476,  502;  and  unemployment  insurance, 
317,  368;  attitude  toward  labor  audit,  323;  payment  of  dues,  353  note; 
shop  committees  and,  408,  412;  represented  on  shop  committees,  419; 
difference  between  company  union  and,  441;  attitude  of  employers 
to,  447,  461,  470,  481;  membership  in,  454,  467,  478,  495;  agent,  need 
of,  455,  477;  disciplinary  methods  of,  460;  contracts  with  craft,  460, 
461 ;  causes  of  violating  joint  agreements  by,  461,  475,  502;  tactics,  463. 
478;  legal  status  of,  465;  purpose  of,  466,  473,  477,  489;  proposal  to 
incorporate,  466,  468,  475;  damage  suits  brought  against,  467;  attitude 
toward  national  industrial  councils,  498;  work  of  national,  499. 

Training,  executives,  Chap.  IX,  135;  need  of  leadership,  135,  150;  pre- 
requisites for  leadership,  138;  rewards  given  in,  138;  administration  of 
executive,  140;  staff,  140,  143;  industrial  instructors.  140,  178;  outline 
for  instructor,  141;  time  of,  142,  178;  class  work,  142,  159;  inspectors, 


I>      5X  537 

145;  foremen,  145,  158,  309;  corporation,  145;  methods  of,  146-150, 
171;  use  of  lectures  in,  147,  183;  the  employee,  Chap.  XIII,  170.  229, 
231;  twofold  problem  of,  170;  cost  of  employee,  175,  179;  "conversion," 
180;  craftsmanship,  180;  special  courses  for  employee,  182,  184,  185;  the 
disabled,  184;  selected  references  on,  151,  187;  inspection  of  work  in,  310. 

Transfers,  of  learners,  175;  of  apprentices,  181;  arousing  interest  in  work 
through,  206,  213,  214,  232;  types  of,  213,  232,  362;  and  promotion, 
Chap.  XVI,  226;  definition  of,  226;  reasons  for,  226,  403;  policies,  226, 
229;  rotation  in,  227,  310;  prerequisites  of,  228;  methods  of,  229,  398, 
selected  references  on,  234. 

Typographical  Journal,  analysis  of  international  council  project  for  printing 
trade,  502. 

United  States,  employment  service,  44,  403,  405  note;  Army  special  tests, 
53;  Army  personnel  work,  55  note;  Army  mental  tests,  55  note;  Army 
personnel  system  of,  55  note;  council  of  national  defense,  117  note, 
119  note;  shipping  board,  177,  178  note,  489  note;  bureau  of  labor  statis- 
tics, 247  note,  333  note,  345  note;  public  health  service,  257  note;  ship- 
building labor  adjustment  board,  274;  department  of  labor,  325,  334, 
362  note;  children's  bureau,  357  note;  chamber  of  commerce,  489. 

Vacations,  annual,  76,  354,  401;  policy  on,  76,  243;  with  pay,  76,  354;  as 
off-setting  industrial  strain,  76,  243,  354  note;  length  of,  77;  savings  for, 
77,  371;  Federal  policy  concerning,  77;  as  rewards,  240. 

Valentine,  R.  G.,  8  note,  304,  429,  430. 

Valentine  &  Gregg,  on  job  analysis,  255  note. 

Veblen,  Th.,  220  note. 

Vestibule  school,  definition  of,  173;  description  of  Packard,  176. 

Vocational  guidance,  a  function  in  personnel  activity,  27. 

Wages,  as  incentive  to  interest  in  work,  218;  and  promotion,  233,  333; 
"dismissal,"  247;  "comfort-minimum,"  274,  311,  316,  333,  336,  341, 
356;  committee  on  rates,  278,  339,  358,  421;  wage  groupings,  301,  316, 
340;  economy  of  high,  316,  468;  and  savings,  318;  determination, 
elements  of,  Chap.  XXIII,  327,  329,  333,  356,  472;  employer's  point  of 
view  on,  327,  357;  employee's  point  of  view,  329,  335,  459;  fact  element 
in,  331,  471;  emmigration  and,  331;  time  factors  in,  332;  sliding  scale 
of,  333,  relation  between  salaries  and,  334;  sources  of  facts  on,  334; 
publication  of  wage  data,  335,  339;  methods  of  securing  facts  on,  335; 
protecting,  336,  347,  398,  493;  objections  to  joint  control  over,  337; 
grades,  340  note;  principles  of  determining,  341,  356;  definition  of  a 
"fair,"  341;  organization  of  wage  committee,  342;  procedure  of  paying 
off,  352;  advancing  wages  to  new  employees,  353;  legislation  and,  355; 
selected  references  on,  360;  guaranteed  annual,  368;  ''retainer  fee,"  398; 
in  relation  to  demand  for  product,  463. 

Waiting  room,  location  of,  52;  atmosphere  of,  52. 

Wallas,  G.,  426  note. 

Webb,  S.,  245  note,  475. 

Webb,  S.  &  B.,  404  note. 


538  INDEX 

Western  Efficiency  Society,  shop  committees  stimulating  production,  212 
note,  428  note;  methods  of  wage  payment,  327  note. 

Westinghouse  Electric  &  Manufacturing  Company,  apprentice  school,  181. 

Whipple,  G.  M.,  55  note. 

Wolf,  D.,  427  note. 

Wolf,  R.  B.,  161  note,  208  note,  342  note. 

Wolfe,  A.  B.,  427  note,  428  note,  494  note. 

Women,  interviewers,  50;  standards  of  hours  and  working  periods  for,  82; 
physical  examination  of,  87;  physicians,  87;  effect  of  vibration  on,  122; 
seats  for,  123;  rest  rooms  for,  123;  toilets  for,  127;  separate  dressing 
rooms  and  lockers  for,  131;  job  instruction  for,  176;  wages  for,  341,  355; 
replacing  men,  355;  "equal  pay"  insuring  economic  independence  of, 
357. 

The  World  Tomorrow,  on  restricting  output  in  British  building  industry, 
344  note. 

Work,  overtime,  73,  effects  of  overtime,  73,  399;  night,  74,  472;  objections  to 
night,  74;  Sunday,  74,  472;  relief  shifts  for  Sunday,  75;  distrust  of  old- 
fashioned  "welfare-work,"  125;  arousing  interest  in,  Chap.  XV,  199, 
204,  268,  340;  definition  of  interest  in,  199;  regularizing,  205,  397,  402, 
405;  singing  at,  218;  as  public  service,  221,  468;  rotation  in,  229;  im- 
portance of  studying  effects  of,  253,  256,  258,  263,  308,  358;  community 
causes  affecting,  264;  nature  and  conditions  of,  265,  332;  unit  of  measure- 
ment for,  272;  piece,  273,  472;  time  studies  on,  275;  grades  of  compe- 
tence in,  274,  276,  340,  459,  470;  definition  of  fair  day's,  278;  length  of, 
332;  hazards  of,  332;  and  wages,  341,  355;  steady,  Chap.  XXVII,  396, 
399,  499,  506;  standardizing,  401,  405,  485;  selected  references  on  steady, 
406. 

Working  conditions,  standard  of  physical,  Chap.  X,  109,  307;  administration 
of  physical,  110;  selected  references  on  standards  of  physical,  133. 

Yale  <fe  Towne,  apprentice  school,  181. 

Y.  M.  C.  A.,  cooperation  in  training  class  work,  142. 

Zeiss  Optical  Works,  premium  paid  to  invested  capital,  349  note. 
Zimmern,  A.  E.,  442. 


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